The number of temporary employees fell by 0.6% to a total of 1.61 million in the three-month period of October to December 2016 when compared to the same period a year ago, according to seasonally adjusted figures by the Office for National Statistics (ONS).

The figures from ONS also showed that the employment rate (the proportion of people aged from 16 to 64 who were in work) was 74.6%, the highest since comparable records began in 1971.

Furthermore, the figures showed that between July to September 2016 and October to December 2016, the number of people in work increased, the number of unemployed people was little changed, and the number of people aged from 16 to 64 not working and not seeking or available to work (economically inactive) decreased.

The unemployment rate was 4.8%, down from 5.1% for a year earlier. It has not been lower since July to September 2005. The inactivity rate (the proportion of people aged from 16 to 64 who were economically inactive) was 21.6%, lower than for a year earlier (21.8%).

The number of UK nationals working in the UK increased by 70,000 to 28.44 million, while the number of non-UK nationals working in the UK increased by 233,000 to 3.48 million, compared to the previous year. Meanwhile, non-UK nationals from the EU working in the UK increased by 190,000 to 2.24 million while, non-UK nationals from outside the EU working in the UK increased by 42,000 to 1.24 million.

“The employment rate is the highest since records began with 300,000 more people in jobs in the last year,” Recruitment & Employment Confederation Chief Executive Kevin Green said. “However, employers are struggling to find and retain the people they need to do the jobs available, particularly in sectors like food manufacturing, hospitality and healthcare, which are heavily reliant on EU workers. The latest data shows a small fall in the number of EU nationals working in the UK – if this becomes a trend over the coming months these businesses will feel even more pressure.”

“The falling economic inactivity rate could be a sign that older workers, particularly older women, are returning to the workforce. But there’s only so far this can go to help alleviate the skills shortage. The government needs to develop a long term approach to the UK labour market, which includes encouraging greater participation and increasing skills but also a balanced approach to immigration,” Green said.

The ONS figures also show that average weekly earnings for employees in the UK in nominal terms (that is, not adjusted for price inflation) increased by 2.6%, both including and excluding bonuses, compared with a year earlier.

Furthermore, total hours worked per week were 1.02 billion for October to December 2016. This was 3.2 million more than for July to September 2016 and 7.1 million more than for a year earlier.

For October to December 2016, 121,000 people had become redundant in the 3 months before the Labour Force Survey interviews, 23,000 more than for a year earlier.

There were 751,000 job vacancies for the 3 months to January 2017, which was 13,000 fewer than for a year earlier.