The Office for National Statistics said the number of people seeking work fell by 79,000 during August bringing the total down to 1.7m.
The British pound reacted well to the news, gaining 0.4% on the dollar during today’s trading.
The fall in joblessness is at odds with the continued lack of any inflation in the British economy, with confirmation coming earlier this week that the UK again slipped to marginal deflation.
The data released this week maintains the complicated picture faced by Bank of England governor Mark Carney and his interest rate setting colleagues.
“Unemployment has hit a seven-year low indicating the economy continues to build momentum,” said Despite the positive jobs news consumers can start planning for the festive holidays, safe in the knowledge that negative turns in prices and global growth will keep a rate rise at bay for a while to come,” said Nick Dixon, investment director at Aegon UK. “While consumers will enjoy the benefits of more cash in their wallet than they did this time last year, it also spells good news for savers, where a spike in earnings means more money to top up savings.”
“Today’s labour market data presented a mixed bag of current trends,” said Investec’s Philip Shaw. “Unemployment fell by 79k over the three months to August. At the same time employment rose by 140k, its biggest three month gain since March, against a 67k decline reported in the three months to May. Much of the latest increase reflected higher part-time employment, which rose by 84k, but the picture presented was clearly one that the labour market has begun to tighten again,” Shaw added.
