UK businesses reduced their spending on redundancy payments last year despite the uncertainty surrounding Brexit, a law firm has found.
Commercial law firm EMW said spending on redundancy payments dropped to £3.6bn by the end of March last year, from £3.8bn the previous year despite the prediction that Brexit would cause widespread job losses.
The total number of redundancy payments in the UK dropped to around 310,000 in 2017-18, down seven per cent on the previous year.
The firm said a "tight labour market with low levels of unemployment" could be encouraging some businesses that are restructuring to reallocate surplus staff rather than get rid of them.
However EMW warned that increased redundancies could still occur as a result of Brexit.
Last October City minister John Glen said the government expected the City of London to lose 5,000 jobs because of Brexit, while last week it was reported that heightened uncertainty over the Brexit negotiations has driven London's financial services companies to move almost £800bn assets to Europe, according to accounting giant EY.
EMW Partner Jon Taylor said: “These statistics show that the two big bogeymen, AI and Brexit, have not created the large-scale job losses that many have feared they would.
“However, that does not mean we are out of the woods yet. There remains continued uncertainty over the shape of the future relationship between the UK and EU. Depending on the final outcome of Brexit, a rise in redundancies is definitely not out of the question.”
At the end of December UK wages grew faster than any time since around the end of 2016, as workers received their biggest pay rise in a decade in the three months to October.
The Office for National Statistics (ONS) data revealed average weekly earnings rose an annual 3.3 per cent in the three months to October, its biggest increase since the three months to July in 2008.
The proportion of people employed in the UK also rose to 75.5 per cent in October last year, reaching its joint-highest rate since comparable estimates began almost fifty years ago. The number of unemployed people also rose, but the number of people aged between 16 and 64-years-old not working and not seeking work, known as economically inactive, decreased.