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UK – Unemployment falls year-on-year

17 April 2013

UK unemployment fell by -0.3% year-on-year between December 2012 and February, the Office for National Statistics (ONS) said Wednesday. But compared to the previous three months, the joblessness rate was up +0.2% and rose by 70,000 from the September to November period.

This means that unemployment in the latest quarter was 7.9%, well below the average rate for Europe which nearly reached 11% in February. Unemployment was highest in the North East (10.1%) and lowest in the South West (6.2%) of the country. The number of people claiming jobseeker's allowance last month fell by 7,000 to 1.53 million.

Meanwhile the employment rate rose +0.9% from a year earlier while it remained unchanged from the previous quarter at 71.4%. There were 29.70 million people in employment aged 16 and over, down 2,000 from September to November 2012, but up 488,000 from a year earlier. Again, employment levels were strongest in the South East and East of England (74.8%) and lowest in the North East (67.1%).

The ONS data also shows that total pay rose by 0.8% compared with December 2011 to February 2012, the lowest growth rate in three years.

“Today’s labor market data provided more evidence that the previous resilience of the jobs market is fading fast,” said Vicky Redwood, chief UK economist at Capital Economics in London. “What’s more, the combination of a slowdown in regular pay growth and a drop in bonuses left overall average earnings unchanged on a year ago. More reason, then, to doubt that the pickup in consumer activity since the start of the year can be sustained.”

Mark Beatson, chief economist at the CIPD, said that “Recent forward-looking indicators of recruitment intentions remain positive.  Nor have we seen any significant change in the number of redundancies.  Hence, at this stage, it would be unwise to read too much into a single month's figures.  Nevertheless, the statistics do remind us that jobs cannot be created forever without a growing economy to sustain demand.  And it is certainly not a question of people pricing themselves out of jobs, as wages excluding bonuses are now growing by just 1 per cent a year, the lowest figure since this data started to be collected in 2001.”

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