Unemployment falls further in Britain as wage growth picks up

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Unemployment falls further in Britain as wage growth picks up

Unemployment falls further in Britain as wage growth picks up
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Unemployment in Britain continues to fall, but the pace of that decline is slowing according to the just released official figures for the period from August to October.

The unemployment rate remained unchanged at 6.0 percent of the workforce – the lowest in six years.

The fall of 63,000 unemployed people was the smallest decline since the three months to September last year. The total number of those without a job was to 1.96 million.

There was some good news for Prime Minister David Cameron ahead of national elections in May in that the earnings of British workers rose by more than inflation in October.

The Office for National Statistics said that in the month of October alone, average weekly earnings excluding bonuses rose by an annual 1.8 percent, the same as September.

Inflation in October stood at 1.3 percent before it fell to 1.0 percent in November, its lowest level in more than 12 years.

That will help him respond to criticism from his political opponents that despite a growing economy many Britons are suffering a cost-of-living crisis.

“It helps the Conservatives in creating a positive story about where the economy is heading which may help them,” said Rob Wood, an economist at Berenberg bank.

But he added that over the previous four years there has been “a heavy squeeze on consumers’ budgets and that is not going to be erased by six months of gains”.

As well as Britain’s political leaders, the Bank of England is keeping a close eye on labour costs as it considers when to start raising interest rates from their record low, something expected only well into 2015.

A majority of BoE policymakers think wages need to grow faster to hit their 2.0 percent inflation target in the medium term, according to the minutes of their December meeting.