Brexit latest: Employment and wage growth slows down at end of 2016
This article indicates a slight economic cooling off at the end of last year, notwithstanding that I feel we are in a far more stable position currently than I feared following the Brexit decision. Lets hope we don’t fall off a cliff face when Mrs May triggers Article 50!
The UK jobs market cooled at the end of last year and wage growth missed City expectations, according to the latest official report.
Job creation slowed to 37,000 in the final three months of 2016, according to the Office for National Statistics, the weakest performance since the second quarter of 2015.
“It is notable that the growth in unemployment has slowed appreciably since mid-2016,” said Howard Archer, an economist at IHS Global Insight.
The jobless rate remained steady at 4.8 per cent while the overall 16-64 employment rate hit a new record high of 74.6 per cent.
“Businesses have become a bit more cautious about hiring since the Brexit vote, although not enough yet to push up the unemployment rate,” said John Hawksworth of PwC.
Average wage growth was 2.6 per cent, down from 2.8 per cent previously.
Economists in a Reuters poll had expected wage growth to continue at 2.8 per cent.
The Bank of England has said that it has a neutral stance on the next movement in interest rates and that it will be watching the wage data especially closely for confirmation that the equilibrium rate of unemployment – the rate at which inflation is stable – has fallen to around 4.5 per cent.
The report prompted a 0.3 per cent slide in the pound against the dollar to $1.243 as traders pushed back expectations of an imminent rate rise.
“These figures tend to support the Bank of England’s view that there is still some slack remaining in the labour market, and therefore a hike in interest rates looks unlikely,” said Ian Kernohan, an economist at Royal London Asset Management.