Round-up of the weekPosted on 22nd July 2016
Employment rate rises to record level
The UK employment rate rose to an all-time high of 74.4 per cent between March and May 2016, new figures have confirmed.
According to the Office for National Statistics (ONS), 31.7 million people are now in work, an increase of 624,000 on last year.
Data also showed that the unemployment rate is now at its lowest point in more than a decade at 4.9 per cent. In addition, average weekly earnings including bonuses went up by 2.3 per cent.
The figures have been hailed as "remarkable" by work and pensions secretary Damian Green, who said: "There are more people in work than at any other point in our history, which is fantastic news as we build a Britain that works for everybody, not just the privileged few.
"We’ve entered a period of significant change, but when it comes to our jobs market we’re in a position of strength, with over 2.6 million more people in work than there were in 2010, the number of workless households cut to an all-time low, 750,000 vacancies in the economy and wages rising too."
Mr Green said the government's task now is to build on this strong performance, so everyone is able to benefit from the opportunities that are being created, "regardless of who they are or where they come from".
He added that the fact employment has gone up in all regions and nations of the UK over the last year is encouraging.
Business community responds to labour market figures
The positive data has been welcomed by leading business groups, but they have stressed they largely account for the period before the EU referendum.
According to the British Chambers of Commerce (BCC), businesses are facing new uncertainty now that the UK has voted to leave the EU.
Suren Thiru, head of economics at the body, said this has been compounded by questions over how the apprenticeship levy and National Living Wage are to be implemented.
"The government should guarantee that EU workers can stay in British firms following the referendum," he commented.
"To maintain business confidence, the government must provide clarity and stability, and press ahead with key infrastructure projects that will boost trade and productivity, empowering businesses to continue to grow and thrive.”
Mr Thiru added that the recent fall in unemployment shows that the UK's labour market "continues to be a bright spot for the UK economy".
He also stressed that the rise in employment is a sign that prior to the EU referendum, businesses were confident enough to hire and grow "despite the softening economic environment".
The CBI, meanwhile, responded by saying that the prospects for the labour market are now more uncertain in the wake of the referendum.
Rain Newton-Smith, chief economist at the body, said: "This highlights the need for continued labour market flexibility, and to ensure the National Living Wage remains affordable for businesses, reflecting the broader economic situation.
"Ultimately, increasing productivity, including by ensuring everyone has the skills to meet their full potential, will help to share prosperity across all areas of the UK.”
To discuss conditions in the labour market and operating environment further, speak to one of our experts here at The Maine Group!