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United Kingdom Unemployment January 2019

United Kingdom: Labor market stays solid in November-January period

In the November-January period, the unemployment rate reached a fresh multi-decade low of 3.9%, while the employment rate rose to a record high. Employment rose by 222,000 compared to August-October, topping market expectations, due to more full-time and part-time positions.

The tight labor market continued to support wage pressures, with nominal earnings growth excluding bonuses remaining at a multi-year high of 3.4%, markedly outpacing the rate of inflation.

In Q1 it is uncertain whether the labor market will be able to maintain such strong momentum; the services and manufacturing PMIs for February showed employers cutting staff levels, while Brexit uncertainty has intensified. Assuming a hard Brexit is avoided however, the unemployment rate should remain low and wage growth robust going forward.

UK Unemployment Rate Forecast

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