How low can the UK jobless rate safely go?

According to the latest official data (mostly covering the three months to February 2017) just released by the Office for National Statistics, the UK labour market continues to enjoy a robust sustainable expansion.  

There were 39,000 more people in work (mostly full-time) in the latest quarter plus a record number of job vacancies (767,000), 45,000 fewer unemployed and 10,000 fewer economically inactive alongside an easing in pay pressure. 

A joint record employment rate of 74.6%, an unemployment rate at a 42-year low of 4.7% and almost zero (0.1%) growth in real average weekly earnings illustrates a remarkable structural change in the operation of the UK labour market compared with earlier decades. 

This particular combination of jobs and pay suggests that the unemployment rate could fall much further, perhaps below 4%, without triggering troublesome pay inflation. While the effect of Brexit uncertainty on the demand side of the economy might yet result in a temporary rise in unemployment later this year, full employment is thus now a more realistic prospect for the UK than at any time since the early 1970s.’