UK Jobless Rate Holds At Lowest Since 1975

Britain’s unemployment rate remains at a 42-year low, official data showed Wednesday, but workers’ wages are still failing to keep pace with inflation.

The jobless rate — or the proportion of the workforce that is unemployed — stood at 4.3 percent in the three months to the end of October, the Office for National Statistics (ONS) said in a statement.

That was unchanged from the three months to September, and the lowest rate since 1975.

Average weekly earnings rose by 2.5 percent year-on-year in the three-month period to October, but lagged behind Britain’s annual inflation rate of 3.1 percent, further eroding workers’ purchasing power.

Britain’s Consumer Prices Index 12-month inflation rate hit a near six-year high last month, fuelled by the rising cost of air fares, computer games and recreational goods, the ONS had revealed Tuesday.

Inflation has soared in 2017 as a Brexit-hit pound ramps up import costs, which led the Bank of England to raise its key interest rate for the first time in a decade earlier last month.

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“The consumer squeeze which has been evident since last year’s referendum continues, as pay adjusted for inflation is still falling,” noted Hargreaves Lansdown economist Ben Brettell.

Sterling tumbled in the wake of last year’s shock EU exit referendum, while Britain is on course to leave the bloc in March 2019.

The ONS added Wednesday that the number of people in work sank by 56,000 to just over 32 million people.

That was the biggest quarterly drop in employment in more than two years — since the three months to May 2015.

Some 1.4 million people were unemployed at the end of October. That was down 26,000 on a year earlier.

The BoE is widely expected Thursday to leave borrowing costs at 0.50 percent following its final monetary policy meeting of the year.

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