Unemployment rises

Unemployment has increased, according to the latest Labour Market figures from the Office of National Statistics.

The figures also show that the number of job vacancies has fallen and growth in average earnings excluding bonuses is slowing.

However, growth in average earnings including bonuses has increased.

The number of people in employment rose by 148,000 over the quarter. The unemployment rate was 4.8%, up 0.1 percentage point from the previous quarter.

The number of vacancies was 631,800, down 16,200 from the previous quarter.

However, these figures should not be interpreted as a portent of bad economic news, according to John Philpott, chief economist at the Chartered Institute of Personnel and Development.

“On the contrary, a combination of strong growth in total employment, fewer redundancies, falling numbers of economically inactive people and an easing in underlying wage pressure indicates that the labour market remains in robust health,” he said.

Higher Lbour Force Survey unemployment figures are explained by rising numbers of economically inactive people, particularly women, entering the jobs market to look for work, he said.

“Together with the fall in the numbers of economically inactive people and a fall in unfilled vacancies this suggests an improved matching between labour supply and demand,” Philpott said.

“It also greatly increases the prospect that interest rates will peak at 4.75% in the current economic cycle.”

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