TG: UK unemployment plummets to six-and-a-half-year low
Britain's jobless rate fell to a six-and-a-half year low in February as the number of people in work smashed through the 31m mark, providing a boost to the Tories less than three weeks before the general election.
The pound jumped above $1.50 against the dollar for the first time in four weeks after official data showed UK unemployment fell to 5.6pc in the three months to February, from 5.8pc in the quarter to November. This is the lowest rate since June 2008, and was in line with expectations.
The data, which were released by the Office for National Statistics (ONS) on a Friday this month instead of Wednesday to take into account the timing of the Easter bank holidays, also showed the number of people in work broke through the 31m mark to reach another record high. This took Britain's employment rate to 73.4pc, which was also the highest since records began in 1971.
There are now 31.05m people in work, almost a quarter of a million more than in the quarter to November, and half a million more than a year earlier. Economists described the data as "remarkable".
"With two-thirds of these additional people employed full-time and almost all employees in permanent jobs this surge indicates real momentum in the ongoing jobs recovery," said John Philpott, director of the Jobs Economist.
Pay also continued to strengthen. Average weekly earnings, excluding bonuses, rose by 1.8pc in the quarter to February, compared with an increase of 1.6pc in the three months to January. In February alone, regular pay rose by 2.2pc compared with a year earlier. The figures also showed private sector regular pay rose by 2.2pc in the quarter to February compared with a year earlier. The single month measure showed growth of 2.6pc.
Including bonus payments, annual earnings growth eased back to 1.7pc in the three months to February, following growth of 1.9pc in January. This compares with zero inflation in February, which has been driven by a dramatic fall in oil prices.
The pound rose by more than a cent against the dollar on Friday morning, to $1.5054, having fallen to a five-year low last week.
"It is very welcome news that wage increases are now higher than inflation and are boosting living standards," said David Kern, chief economist at the British Chambers of Commerce.
While the increase in real pay has so far been driven by low inflation rather than sharp increases in pay growth, economists said the fact that vacancies were at a record high suggested stronger wage growth was on the cards.
