A record proportion of Britons are in work, providing a timely boost to chancellor George Osborne ahead of May’s General Election.
There were 30.94m people in work in the three months ending January – 617,000 more than the same period last year, according to figures released yesterday by the Office for National Statistics.
The employment rate – the proportion of people aged 16-64 in work – climbed to a record high of 73.3 per cent. Comparable records began over 40 years ago.
The unemployment rate – the proportion of the labour force who are actively looking job and do not have one – is now 5.7 per cent, compared with 7.2 per cent last year. However, it is the same as it was for the three months ending December.
The number of private sector workers, and the proportion of those in the private sector, both hit their highest levels for this century.
“The big picture is of strong growth in full-time jobs in the private sector, record employment and the highest level of vacancies in 12 years. A tightening labour market is bringing the long-awaited wage recovery. After falling for six years, real earnings are growing at the fastest rate since 2008,” said Ian Stewart, chief economist at financial services firm Deloitte.
Annual growth in weekly earnings in the three months ending January dropped to 1.8 per cent from 2.1 per cent in the three months ending December. Growth in real earnings – the goods and services that can be bought with earnings – remains robust with the last reading for inflation at 0.3 per cent in January. “Wage growth is still outpacing inflation comfortably,” said Vicky Redwood, chief UK economist at Capital Economics.
“What’s more, January’s slowdown in pay growth was driven by a drop in City bonuses, probably just reflecting timing effects excluding bonuses, economy-wide wage growth was steady at 1.6 per cent.”