The UK labour market continues to confound economists and defy any signs of a Brexit-related slowdown, with the proportion of people in work reaching yet another record level.
Statistics from the latest Labour Force Survey showed that the number of people in work increased by 179,000 during the three months to February 2019, taking the total employment figure to a new record high of 32.7 million. Over the past year, this figure has risen by 457,000, with the increase due to more people working in a full-time capacity via a combination of full-time employees and the self-employed.
The data also showed that the total number of people unemployed fell by a further 27,000 during the three months to February. This left the total unemployment rate at 3.9%, its lowest level since the end of 1975. Further growth in real pay levels was also reported in the latest batch of employment statistics. When adjusted for inflation, average earnings including bonuses, were found to have increased by 1.5% in the three months to February, compared to the same period a year earlier, the highest annual real rate of growth since the summer of 2016.
The continuing resilience of the jobs market has noticeably been in contrast to other more sluggish readings of the UK economy. And this strong set of employment data once again highlights that, while Brexit anxieties may be deterring many businesses from investing, it is certainly not deterring them from taking on more workers. Firms’ hiring plans, however, do typically lag behind changes in economic activity as businesses wait to assess the full impact of any changes in demand. Many economists are still therefore warning that signs of labour market weakness could yet emerge later in the year, particularly if the uncertainty surrounding Brexit is not resolved quickly.