Unemployment falls – but fears over low wages
THE latest jobs figures show that unemployment in Wales has fallen to just 4% – down from 6% two years earlier.
There were just 60,000 people aged 16-plus on the dole in Wales in the three months to August, compared with 91,000 in 2015.
During the past two years the number of men out of work has dropped from 58,000 to 35,000, while the figure for women has gone down from 32,000 to 25,000.
Unemployment also fell at a UK level, but there is concern that wages are lagging behind inflation.
Average earnings increased by 2.2% in the year to August.
This was unchanged on the previous month and below the latest inflation rates of 3.9% (RPI) and 3% (CPI).
Stephen Clarke of the Resolution Foundation said: “Today’s figures confirm the big picture trend that the UK labour market is great at creating jobs, but terrible at raising people’s pay.
“The scale of the pay squeeze over the last decade is so vast that people today are earning no more than they did back in February 2006, despite the economy being 4.4% bigger per person since then.”
Matthew Percival, the CBI’s head of employment, also laid out his concerns, saying: “Persistently weak productivity, coupled with falling real wages, continues to hit living standards, underlining the need for the Chancellor to bold in his Budget.”
He called for “urgent progress on large and small infrastructure projects” and pushed for “practical support for innovators”.
UK Employment Minister Damian Hinds defended the Government’s record, saying: “We’ve boosted the income for people on the lowest pay by increasing the national living wage and delivered the fastest pay rise for the lowest earners in 20 years. That’s great progress and we’re determined to help more people flourish in the world of work.”
But TUC general secretary Frances O’Grady said: “Pay packets are taking a hammering. This is the sixth month in a row that prices have risen faster than wages...
“Working people are earning less today in real-terms than a decade ago. The Chancellor must help struggling families when he gives his Budget next month.
“This means ditching the artificial pay restrictions on nurses, midwives and other public sector workers and investing in jobs that people can live on.”
First Minister Carwyn Jones welcomed the fall in unemployment in Wales, saying: “Today’s figures show that Wales has an unemployment rate that is lower than the UK average and that the unemployment rate here has fallen faster than in the rest of the UK over the quarter. We are continuing to work hard to grow and build resilience within Wales’ economy and today we are launching the Development Bank of Wales – the first of its kind in the UK.
“The Development Bank will use Welsh Government funding to support investments that will help grow Wales’ economy both today and into the future and provide our businesses with the support they need to prosper and grow.”
ONS statistician Matt Hughes said: “Many labour market measures continue to strengthen. Employment growth in the latest threemonth period was driven mainly by women, with a corresponding drop in inactivity.
“Vacancies remain robust, at a near-record level. On the other hand, total earnings in cash terms grew slower than prices over the last year, meaning the real value continues to fall – down 0.3% over that period.”