Member Article

UK unemployment falls under 2 million but wages stagnate below inflation

UK unemployment total has fallen below two million, taking the employment rate to 6% for the first time since 2008 Office for National Statistics results show.

The number of jobless people fell by 154,000 to 1.97 million in the three months to the end of August, however wage growth remained below the current 1.2% inflation rate.

According to the ONS there were 30.76 million people in work, or 73% of people aged 16 to 64, up from 71.5% for a year earlier. This was 46,000 more than for March to May 2014, however it is the smallest quarterly increase since March to May 2013.

These changes continue the general direction of movement since late 2011/early 2012.

There were 9.03 million people aged from 16 to 64 who were out of work and not seeking or available to work (known as economically inactive). This was 113,000 more than for March to May 2014 but 46,000 fewer than for a year earlier.

According to the BBC, Chancellor George Osborne said the fall in unemployment was “evidence that our long-term economic plan is working”.

He said: “I’m the first to say there are still too many people out of work. We need to make further reforms to our welfare system so that people have a life of work, rather than a life on the dole.”

Rachel Reeves MP, Labour’s Shadow Work and Pensions Secretary, responding to today’s Labour Market Statistics, said: “Today’s fall in overall unemployment is welcome, but the new figures show working people are continuing to see their pay fall far behind the cost-of-living.

“Working people have seen their real wages fall by over £1,600 a year since 2010. The Government’s failure to act on low pay has led to millions of people struggling to get by, huge additional costs in Housing Benefit and Tax Credits paid to those in work, and the OBR warning about the impact on the public finances.”

This was posted in Bdaily's Members' News section by Clare Burnett .