Employment at record high as real wages edge upwards

THE number of people in the UK who have a job has hit another record high according to official statistics, as wages have continued to grow in real terms.

The latest record for employment – the highest level since comparable records began in 1971 – showed that there were 32.4m people in work from March to May this year. This was nearly 400,000 higher than the same period a year earlier. Overall, the employment rate was at 75.7pc.

Unemployment remained at 4.2pc, the Office for National Statistics said. This was the joint lowest level since 1975. Matt Hughes of the ONS said: “We’ve had yet another record employment rate, while the number of job vacancies is also a new record. From this it’s clear that the labour market is still growing strongly.

“Meanwhile, real earnings remain modestly up on the year, both including and excluding bonuses.”

Employment levels are closely watched by interest rate setters at the Bank of England. They will also have paid close attention to earning levels, which showed signs of steady, if muted, growth.

Average weekly earnings increased by 2.5pc, including bonuses, compared with a year earlier. Once the impact of rising prices was factored in, pay packets increased in real terms by 0.2pc compared to a year earlier. The rate of growth was down by 0.1 percentage points, from 2.6pc in April.

Samuel Tombs, of Pantheon Macroeconomics, said the data were “hardly a humdinger” but would be enough to persuade policymakers to press ahead with August’s rate hike. The market expects rates to rise from 0.5pc to 0.75pc.

Tej Parikh, of the Institute of Directors, said that the UK’S strong record for job creation should “not be taken for granted”.