The number of people unemployed in the UK fell by 20,000 to 1.67 million, which is the lowest number since March-May 2008. Wage growth improved, but remained unimpressive at 2.3% excluding bonuses.
“The 2.3% rise in earnings, which adds further sheen to the data, will be particularly pleasing to Carney and the MPC as they survey the post-referendum landscape and, in the case of a ‘remain’ outcome, will soon begin to consider the economy’s readiness for monetary policy changes,” said Richard de Meo, managing director of Foenix Partners.
But ultimately, the figures confirming that the number of UK workers in employment has held firm at record highs will be overshadowed by the upcoming EU referendum, in de Meo’s view.
“Evidence of a resilient underlying economy will be undermined and overlooked by the much bigger question of EU membership, ensuring that sterling price action remains most correlated to poll results and Brexit sentiment,” he said.
According to Ben Brettell, senior economist at Hargreaves Lansdown, the new unemployment figures constitute unexpected good news among the Brexit-related uncertainty.
“The UK labour market remains in good health despite a wider economic slowdown ahead of the referendum,” said Brettell. “The economy continues to add jobs, and wage growth is running ahead of consumer price inflation, which held steady yesterday at 0.3%,” he added.
The data will go some way to lessen fears that businesses have been delaying decisions about hiring and investment until after the EU vote, noted Brettell.
