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UK – Employment rises to four-year high

12 September 2012

In August UK employment hit its highest level in more than four years, the Office for National Statistics reports today. Jobless claims fell by the largest amount in over two years, suggesting an Olympic boost and raising hopes that the jobs market is improving.

From May to July 2012, the number of people in employment increased by 236,000 when compared to the previous quarter, seeing an employment rate of 71.2%. In the period there were 2.59 million unemployed people – 8.1% of the economically active population – this is down 7,000 on the quarter. The number of people claiming jobless benefits fell by 15,000 (including 5,500 in London) last month to 1.57 million, the largest monthly fall since June 2010.

“Businesses tell us that times are tough, but opportunities to grow remain. Today's labour market figures confirm this, with firms creating jobs at a robust pace, more than offsetting public sector job losses in the second quarter. Total unemployment has fallen, and fewer people are claiming jobseeker's allowance,” said Neil Carberry, Director for Employment and Skills at the Confederation of British Industry.

“Unemployment among young people remains a huge challenge. The number of young people out of work has risen this month, but this is alongside 75,000 more who have started actively looking for work, with 58,000 more young people finding work in the three months to July.

“At a critical time of year, with many young people entering the labour force for the first time, it is encouraging that youth employment is rising, but the Government cannot afford to lose focus on this vital issue.”

The resilience in Britain's labour market has been a puzzle for most economists, leaving analysts to wonder how an economy in recession can still create jobs.

The ONS said the number of public sector employees fell by 235,000 in the second quarter to 5.66 million – the lowest since 2001 – although most of that drop was due to education organisations being transferred to the private sector.

The number of full-time workers increased by 102,000 on the previous quarter to reach 21.44 million; and the number of part-time  workers  increased by 134,000 to reach 8.12 million, the highest figure since comparable records began in 1992.

The number of employees and self-employed people who were working part-time because they could not find a full-time job increased by 24,000 on the quarter to reach 1.42 million, again the highest figure since comparable records began.

Total pay (including bonuses) rose by +1.5% on a year earlier, down -0.3% on the three months to June 2012. Regular pay (excluding bonuses) rose by +1.9% on a year earlier, up +0.1% on the three months to June.

To watch a short video on the results, click here.

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