UK unemployment falls to 2.5m with private sector job creation

Written on:December 12, 2012
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UK unemployment falls to lowest levels in a decade

Less people out of work as the UK unemployment falls to lowest levels in a decade

The UK unemployment rate fell to its lowest level in a decade falling by 82,000 in the three months from August to October to 2.51m, as the private sector created jobs faster than they were being shed in the public sector, according to Office for National Statistics.

The UK unemployment rate, which fell for four consecutive months until July, stood at 7.8%, down 0.2 percentage points from the previous three months. After a strong expansion in the summer, the economy showed signs of weakening in autumn but unemployment rates came down with 29.6m employments following a 40,000 quarterly rise, which is the highest figure since records began in 1971.

The Office for National Statistics also said that the number of people claiming Jobseeker’s Allowance fell 3,000 to 1.58 million in November. Total pay was up 1.8% compared with the same period last year.

The rise in employment rates stemmed from growth of 65,000 in private sector, while public sector jobs shrank by 24,000 to 5.7m, its lowest level in a decade. ONS said there are 23.8m private sector jobs in the economy, a figure which is more than ever before.

James Knightley from ING said, “The main disappointment was the fact that despite the gains in employment, there is no pick-up in wage growth, which remains at 1.8%, year on year. The fact that UK employment is rising, consumer confidence is up and anecdotal evidence of retail sales haven’t been too bad, offers some hope that the domestic situation in the UK is stabilising.”

According to Ross Walker, UK economist at RBS, the flexibility of the workforce has been part of fall in unemployment rate. He observes that there have been large numbers of part-time jobs in previous months, small rises in average wages and the increase in self-employment.

     

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