United Kingdom: Employment surges in September–November, wage growth stays robust
The unemployment rate was stable at 3.8% in the September–November period, a multi-decade low. Moreover, employment soared by 208,000 quarter-on-quarter on more full-time jobs, far exceeding market expectations, while regular pay growth (excluding bonuses) markedly outpaced inflation. In addition, the number of vacancies ticked up in the three months to December, the first increase following a prolonged decline. Taken together, these readings are further evidence of a firming of the labor market following soft readings in the middle of the year.
According to analysts at Nomura: “[The] numbers looked pretty good: annual growth in employment of over 1% (having picked up a couple of tenths over the past few months), full-time jobs making up the vast majority of the total rise in employment during the quarter, and total hours worked rising more quickly.”
Looking ahead, the labor market is seen staying tight, even though the Consensus is for a slight rise in the unemployment rate this year. The evolution of Brexit negotiations could have an important bearing on labor market developments.