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Britain's average pay rises, but so does unemployment Britain's average pay rises, but so does unemployment
(about 3 hours later)
Britain enjoyed a bumper pay rise in May, after average earnings jumped to a five-year high of 3.2%,, highlighting the increasing skills shortages forcing employers to offer higher wages. Britain enjoyed a bumper pay rise in spring, with average earnings 3.2% higher in the period from March to May 2015 than a year earlier, highlighting the increasing skills shortages forcing employers to offer higher wages.
But the better earnings figures from the Office for National Statistics came as unemployment rose for the first time in two years, sparking fears that Britain’s booming labour market has lost some of its momentum. But the better earnings figures, from the Office for National Statistics, came as unemployment rose for the first time in two years, sparking fears that Britain’s booming labour market has lost some of its momentum.
Employment also fell for the first time in two years, dragged down by the government’s continued austerity programme that has forced 22,000 public sector job cuts since December and 59,000 since May last year.Employment also fell for the first time in two years, dragged down by the government’s continued austerity programme that has forced 22,000 public sector job cuts since December and 59,000 since May last year.
James Knightley, UK economist at ING, said: “This is the first fall in employment since March 2013 and the first rise in the unemployment rate since December 2013.James Knightley, UK economist at ING, said: “This is the first fall in employment since March 2013 and the first rise in the unemployment rate since December 2013.
“At the margin it may temper rate hike expectations following recent, mildly hawkish Bank of England comments and take the steam out of sterling’s recent strong run. However the numbers do seem a little odd given the strength in the activity data and the fact that the number of job vacancies remains very high at 726,000.”“At the margin it may temper rate hike expectations following recent, mildly hawkish Bank of England comments and take the steam out of sterling’s recent strong run. However the numbers do seem a little odd given the strength in the activity data and the fact that the number of job vacancies remains very high at 726,000.”
Scepticism at the fall in unemployment was rife across the City, which considers Britain to be returning to its 2013-style period of rapid recovery after a lull in the second half of 2014 and the first few months of this year.Scepticism at the fall in unemployment was rife across the City, which considers Britain to be returning to its 2013-style period of rapid recovery after a lull in the second half of 2014 and the first few months of this year.
The ONS said the number of people claiming unemployment-related benefits last month rose by 7,000 to 804,200, while average earnings increased by 3.2% in the year to May, 0.5 percentage points on the previous month.The ONS said the number of people claiming unemployment-related benefits last month rose by 7,000 to 804,200, while average earnings increased by 3.2% in the year to May, 0.5 percentage points on the previous month.
For March to May 2015, 1.85 million people were unemployed, which was 15,000 more than in February – an unemployment rate unchanged at 5.6%.For March to May 2015, 1.85 million people were unemployed, which was 15,000 more than in February – an unemployment rate unchanged at 5.6%.
Youth unemployment fell 92,000 on February though it is not known how many went into apprenticeship schemes rather than full or part-time paid work.Youth unemployment fell 92,000 on February though it is not known how many went into apprenticeship schemes rather than full or part-time paid work.
The Resolution Foundation said a measure of regular weekly pay adjusted for inflation showed that wages had fallen slightly in the last month and that wages were still well short of their inflation-adjusted peak in 2004.The Resolution Foundation said a measure of regular weekly pay adjusted for inflation showed that wages had fallen slightly in the last month and that wages were still well short of their inflation-adjusted peak in 2004.
Labour disputes remained at historical lows, the ONS said. There were 699,000 working days lost from 160 stoppages in the last year compared with 1980’s record figure of 32.2m.Labour disputes remained at historical lows, the ONS said. There were 699,000 working days lost from 160 stoppages in the last year compared with 1980’s record figure of 32.2m.