UK labour market continues to be in a fairly healthy state - EY ITEM Club comments

15 June 2016

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  • Unemployment rate down to 5.0%
  • Employment up by 1.5% over last year
  • Regular weekly earnings growth edges up but not an inflation concern

Martin Beck, senior economic advisor to the EY ITEM Club, comments:

“These figures confirm that the UK labour market is in a fairly healthy state. Employment growth continues to be steady and inflation remains low.

“Over the last year employment has increased by 461.000 (1.5%). Although the pace of employment growth has eased unemployment levels of 5% are consistent with the MPC’s view of the long run equilibrium rate.

“Earnings data showed a slight pick-up in regular pay which, in the three months to April, was 2.3% higher than in the same period a year ago. However, wage growth remains well below levels that may cause the MPC to worry about any incipient inflationary pressures.”