The UK Office for National Statistics (ONS) has just published its latest monthly update on the labour market with data mostly covering the quarter July to September.
The initial observation is another month and still no obvious sign of
Brexit in the official labour market numbers. Employment is up 49,000 on the
quarter with a further fall in unemployment of 37,000 cutting the headline
jobless rate to 4.8%. Job vacancies are also up while redundancies have held
steady. The only possible sign of a
cooling in the market is a somewhat slower pace of job creation and a quarterly
rise of 49,000 in the number of economically inactive people which has meant a
relatively small increase in jobs could still reduce unemployment, albeit the
ONS finds no evidence of any post Brexit vote fall in migrant workers.
As a
result the UK labour market continues to tighten, giving a boost to pay growth
(average weekly earnings are now growing at an annual rate of 2.4% excluding bonuses) even though the ONS estimates that the
rate of growth of hourly labour productivity dipped from 0.6% to 0.2% between
the second and third quarter of the year. Overall therefore the labour market
looks to be in pretty good shape and there is nothing to indicate that Brexit
uncertainty has hit hiring or resulted in greater firing. However, with Brexit
unlikely to aid productivity growth in the short run at a time when higher
price inflation is also in the pipeline even a strong labour market may
struggle to deliver sustained real wage improvements for most UK workers.”
