Brexit doesn’t affect UK job market

7 years ago - Published in Finance, Fundamental Analysis

The UK's unemployment rate has fallen to its lowest since the summer of 1975, with a record number of people in work: the Office for National Statistics (ONS) said the unemployment rate fell to 4.7% .

Other figures published on Wednesday showed that unemployment fell by 31,000 in the three months to January, to 1.58 million, the lowest for a decade, giving a jobless rate of 4.7%, the lowest since the summer of 1975.

Almost 32 million people are now in work, a jump of 92,000 over the quarter and 315,000 compared with a year earlier. "March's labour market release reported a solid performance on the jobs side, but included worrying signs of weakness with regards to wages," said Martin Beck, senior economic advisor to the EY Item Club – a respected economic forecasting group.

The number of people on the claimant count, including Jobseeker's Allowance and those on Universal Credit required to seek work, fell by 11,300 last month to 734,700, the lowest since May 1975.

Average earnings increased by 2.2% in the year to January, down by 0.4% on the previous month.
Since the Brexit vote, various economists and financial institutions have predicted that the UK's unemployment rate will shoot up as a result of the vote to leave. Credit Suisse, for example, predicts an increase to 6.5% for the base rate, equivalent to roughly 500,000 jobs being lost. However, the last few months have seen the rate remain near its record low and Wednesday's figures show the trend appears to be holding up.

David Freeman, senior statistician at the ONS, said: “With the unemployment rate last lower in summer 1975 and the employment rate still at a record high, the labour market remains robust. But smaller wage increases and higher inflation mean the growth in real earnings has slowed sharply in recent months.”
The employment minister Damian Hinds welcomed the fall in unemployment, saying: “Employment is up, wages are up and there are more people working full time. This is good news for hardworking families across the UK as we continue to build a country that works for everyone.”