Unemployment in Scotland drops as European Union workers leave UK

Unemployment in Scotland drops as European Union workers leave UK

LONDON - The rate of unemployment in the United Kingdom fell to just 4% between April and June this year - the lowest level since comparable records began in the early 1970s - according to the latest data from the Office for National Statistics, published on Tuesday morning.

The BoE expects the unemployment to fall to 3.9% this year, according to the governor of the financial institution, further interest increases will be needed to bring inflation back to the target of 2%.

The closely watched wage growth stabilized in three months to June period with wages excluding bonuses rising 2.7% over the year and wages including bonuses decelerated to 2.4% y/y.

They also show a rise in productivity, but a slowdown in wage growth.

On productivity, the ONS also said output per hour worked was up by 1.5% - the biggest rise since late 2016.

However, there are few signs of overall wage increases - wage growth is slowing down to a nine-month low of 2.4% between April and June. That left 780,000 people with those conditions as their main job.

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The number of people classed as economically inactive, including students, those on long-term sick leave, taken early retirement or who have given up looking for work, increased by 77,000 to 8.7 million in the latest quarter, giving a rate of 21.2%.

"Shortages are already hampering firms' ability to compete and create jobs, so it's vital that the United Kingdom pursues an open and controlled post-Brexit immigration policy", Matthew Percival, head of employment at the Confederation of British Industry, said.

But recently, reality's looked just a little more willing to conform to economic predictions.

The unemployment rate fell to 4.0 per cent in the April through June period, the lowest since the three months to February 1975.

And there's a key factor making the labour market tighter: a net outflow of European Union nationals working in the UK.

"Average weekly earnings for employees in Great Britain in real terms (that is, adjusted for price inflation) increased by 0.4% excluding bonuses, and by 0.1% including bonuses, compared with a year earlier", the ONS said. The expectations of the economists were the rate to stay at 4.2%.

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