Introduction: ‘Signs of recovery’ in UK jobs market as unemployment rate falls
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
Britain’s unemployment rate has fallen, in a sign that the labour market may be recovering as the economy emerges from the Covid-19 lockdown.
The UK unemployment rate in January-March fell to 4.8%, down from 4.9% a month ago, and 0.3 percentage points lower than the previous quarter, new figures from the Office for National Statistics show.
But, unemployment is still 0.8 percentage points higher than in December-February 2020, reflecting the economic damage caused by Covid-19.
The ONS also reports that the employment rate increased for the first time since the start of the pandemic. It rose to 75.2% in January-March, up 0.2 percentage points over the quarter, for the first time since December 2019 to February 2020.
However, with lockdown restriction in force across the country during the quarter, the UK economic inactivity rate rose, meaning that more people dropped out of the labour market. It was estimated at 21.0%; 0.8 percentage points higher than December 2019 to February 2020 and 0.1 percentage point higher than the previous quarter.
Total hours worked also fell, due to the pandemic restrictions.
The ONS says there are ‘signs of recovery’.
Following a period of employment growth and low unemployment, since the start of the pandemic employment has generally been decreasing and unemployment increasing.
However, the latest (January to March 2021) estimates show signs of recovery, with a quarterly increase in the employment rate. Meanwhile, there was a quarterly decrease in the unemployment rate and the economic inactivity rate increased on the quarter.
With the reintroduction of many coronavirus restrictions, total hours worked decreased on the quarter.
More details and reaction to follow…..
Also coming up today
A new report has warned that Britain risks mirroring Italy’s economic woes unless it develops a strategy for tackling the five seismic changes that will shape the next decade.
Our economics editor Larry Elliott explains:
A joint project by the Resolution Foundation thinktank and the London School of Economics said the UK was neither used to nor prepared for the challenges posed by the aftermath of Covid-19, Brexit, the net zero transition, automation and a changing population.
Announcing the launch of their Economy 2030 Inquiry, the two organisations said muddling through without a proper plan would be disastrous for the living standards of individuals and the economy as a whole.
European stock markets are expected to open higher this morning, with the FTSE 100 called up
- 10am BST: Eurozone Q1 GDP figures (second estimate) and March trade data
- 1.30pm BST: US building permits and housing starts for April
- 3pm BST: House of Lords Economics Affairs Committee hearing into QE, with Bank of England governor Andrew Bailey, and deputy governors Ben Broadbent and Dave Ramsden