ALBAWABA – Data issued Tuesday by the United Kingdom’s (UK) Office of National Statistics show UK unemployment rose back to 4 percent in the months of March through May, as the economy struggles with sticky inflation.
The UK employment rate is estimated at 76 percent in March to May 2023, 0.2 percent higher than in December 2022 to February 2023.
Meanwhile, inflation in the UK is stubborn at 8.7 percent, the Guardian reported.
UK unemployment averaged 3.8 percent in the three months February through April.
The quarterly increase in employment was mainly attributed to part-time employment terminations, according to the Office of National Statistics.
This is the first time the unemployment rate in the UK reaches 4 percent since the beginning of 2022.
Agence France-Presse’ (AFP) analysts expected UK unemployment to remain at 3.8 percent.
In the period from April to June 2023, the estimated number of vacancies fell by 85,000 on the quarter, to 1,034,000, according to the official statistics. Vacancies fell on the quarter for the 12th consecutive period.
Wage growth in the UK is also at its highest in nearly two years.
Growth in employees' average total pay (including bonuses) was 6.9 percent and growth in regular pay (excluding bonuses) was 7.3 percent, March through May, 2023.
However, growth in wages adjusted for inflation fell 1.2 percent in total, and 0.8 percent for regular pay fell in the year ending March to May 2023.
A hot labor market typically indicates high inflation, and vice versa.
The governor of the Bank of England Andrew Bailey said current levels of price and wage increases are inconsistent with reducing inflation, according to Guardian.
He hinted at another UK interest rate increase in August, which would be the 14th successive hike since the central bank launched its monetary policy tightening campaign last year.
