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Wage growth picks up as UK unemployment falls | |
(35 minutes later) | |
Wage growth in the UK is picking up, figures from the Office for National Statistics (ONS) indicate. | |
In the August-to-October period, average earnings excluding bonuses were up 1.6% from a year earlier. Including bonuses, earnings rose by 1.4%. | |
It is the first time for six years that both measures of earnings growth have been above the inflation rate. | |
Meanwhile, the number of people unemployed in the quarter fell by 63,000 to 1.96 million. | |
The fall was the slowest quarterly fall for a year, leading some analysts to speculate that the rate of improvement may have peaked. | The fall was the slowest quarterly fall for a year, leading some analysts to speculate that the rate of improvement may have peaked. |
The jobless rate was 6%, matching its lowest level in six years. | |
The ONS figures also showed that there were 30.80 million people in work in the three-month period, 115,000 more than for the May-to-July period, driven by more people in full-time work. | |
The number of people claiming Jobseeker's Allowance in November fell by 26,900 to 900,100. | |
'Decent improvement' | |
"Earnings growth is finally starting to open a clear positive gap over inflation, which is serious good news for consumers," said Howard Archer, economist at IHS Global Insight. | "Earnings growth is finally starting to open a clear positive gap over inflation, which is serious good news for consumers," said Howard Archer, economist at IHS Global Insight. |
"This bodes well for consumer spending in 2015, although it needs to be borne in mind that consumers have faced a prolonged squeeze on their purchasing power. | "This bodes well for consumer spending in 2015, although it needs to be borne in mind that consumers have faced a prolonged squeeze on their purchasing power. |
"Meanwhile, the labour market is still seeing decent improvement, although the underlying rate of improvement is showing signs of moderation," he added. | "Meanwhile, the labour market is still seeing decent improvement, although the underlying rate of improvement is showing signs of moderation," he added. |
On Tuesday, figures showed the UK's rate of inflation fell to a 12-year low of 1% in November, from 1.3% in October. | |
Earlier on BBC Radio 5 live, the Bank of England's deputy governor, Jon Cunliffe, said UK inflation in the coming months was "going to be low". | |
In a tweet, Prime Minister David Cameron said: "Employment is at a record high & average earnings are rising faster than inflation. More to do, but our long term economic plan is working." | In a tweet, Prime Minister David Cameron said: "Employment is at a record high & average earnings are rising faster than inflation. More to do, but our long term economic plan is working." |
But Rachel Reeves, the shadow secretary for work and pensions, said some groups were still struggling to find work. | |
"Long-term youth unemployment has risen over the last few months. So there's still much more that the government needs to do." | |