UK employment remains at record high but wage growth slows further

11 June 2019

The rate of UK employment remains at a record high, driven by the increase in the number of women working.

The number of people in work rose by 32,000 in the three months to April to reach a new record of 32.8 million, according to the Office for National Statistics (ONS).

However, this was the smallest increase since August last year.

The employment rate remained at 76.1% of the working-age population - the joint-highest figure since records began in 1971.

Wages rose by 3.1% in the three months to April including bonuses, slower the previous month’s 3.3% rise but still above inflation.

However, the number of vacancies in the UK economy has fallen, which could be a sign that employment growth is weakening.

There were 837,000 unfilled positions in the three months to May, down from 861,000 at the start of the year.

Including bonuses, average weekly earnings for employees rose by 3.1%, down from 3.3% last month.

Howard Archer, chief economic advisor to the EY ITEM Club, says: “The labour market is not showing the same degree of strength that was apparent at the start of the year.

"This is to be expected given prolonged Brexit uncertainties, recent lacklustre UK economic activity, an unsettled domestic political environment and a challenging global economic environment.”

Job market resilience

Brexit could be supporting higher employment as analysts believe the resilience of the jobs market can be attributed to firms being more likely to hire during uncertain times, as it is cheaper than committing to long-term investment.

Over the past year employment has risen 357,000, due to the increase in full-time jobs.

Meanwhile, UK unemployment fell 34,000 to 1.3 million, with the rate of 3.8% the lowest since the mid-1970s.

The employment rate for women was 72%, the highest on record. This comes after changes to the state pension age which have resulted in fewer women retiring between 60 and 65. This means there are now 15.5 million women in work.

ONS deputy head of labour market statistics Matt Hughes says: “With employment growth among women coming from full-timers, the overall gap between men and women in hours worked is now the lowest ever – women now average about three-quarters of men’s weekly hours, compared with around two-thirds 25 years ago.”

PwC chief economist, John Hawksworth, says: "The UK economy has been a great job creating machine over the past seven years and employment continued to rise over the past three months.

“However, the rate of increase in the latest three months was slower than in most previous quarters, which may be a sign that Brexit-related uncertainty is beginning to make companies more cautious about new hiring.”

Add new comment