The jobs market held up well in August and September, showing few adverse effects from the June Brexit referendum result.
The latest report from the Office for National Statistics showed the numbers in employment between June and August rose 106,000 on the previous quarter, while the number of unemployed edged up by 10,500.
The unemployment rate was steady at 4.9 per cent.
The more up-to-date claimant count in September showed an increase of just 700 on the previous month, against City analysts’ expectations of a 3,000 increase.
Average wages were up by 2.3 per cent year on year, down slightly from the 2.4 per cent for the previous period, but in line with expectations.
Vacancies, a sign of healthy demand in the labour market, were 749,000 in the three months to September, down slightly from the 750,000 in the three months to August.
“These figures show that employment continued to grow over the summer and vacancies remain at high levels, suggesting continuing confidence in the economy. While there was also a small rise in the headline unemployment level, that was accompanied by more people actively seeking work,” said Nick Palmer of the ONS.
Scott Bowman of Capital Economics said the muted wage growth “should provide the [Bank of England's] Monetary Policy Committee with some comfort that domestic cost pressures aren’t increasing by much at a time when the fall in the pound should result in a sharp rise in externally driven costs”.
However, some analysts saw signs of a slowdown in the latest report. The quarterly rate of employment growth of 106,000 was the lowest since April and down from 174,000 and 172,000 in the previous two months.
The 10,500 quarterly increase in unemployment was the first increase since February.
What experts have said about Brexit
What experts have said about Brexit
1/11 Chancellor of the Exchequer Philip Hammond
The Chancellor claims London can still be a world financial hub despite Brexit “One of Britain’s great strengths is the ability to offer and aggregate all of the services the global financial services industry needs” “This has not changed as a result of the EU referendum and I will do everything I can to ensure the City of London retains its position as the world’s leading international financial centre.”
2/11 Yanis Varoufakis
Greece's former finance minister compared the UK relations with the EU bloc with a well-known song by the Eagles: “You can check out any time you like, as the Hotel California song says, but you can't really leave. The proof is Theresa May has not even dared to trigger Article 50. It's like Harrison Ford going into Indiana Jones' castle and the path behind him fragmenting. You can get in, but getting out is not at all clear”
3/11 Michael O’Leary
Ryanair boss says UK will be ‘screwed’ by EU in Brexit trade deals: “I have no faith in the politicians in London going on about how ‘the world will want to trade with us’. The world will want to screw you – that's what happens in trade talks,” he said. “They have no interest in giving the UK a deal on trade”
4/11 Tim Martin
JD Wetherspoon's chairman has said claims that the UK would see serious economic consequences from a Brexit vote were "lurid" and wrong: “We were told it would be Armageddon from the OECD, from the IMF, David Cameron, the chancellor and President Obama who were predicting locusts in the fields and tidal waves in the North Sea"
5/11 Mark Carney
Governor of Bank of England is 'serene' about Bank of England's Brexit stance: “I am absolutely serene about the … judgments made both by the MPC and the FPC”
6/11 Christine Lagarde
IMF chief urges quick Brexit to reduce economic uncertainty: “We want to see clarity sooner rather than later because we think that a lack of clarity feeds uncertainty, which itself undermines investment appetites and decision making”
7/11 Inga Beale
Lloyd’s chief executive says Brexit is a major issue: "Clearly the UK's referendum on its EU membership is a major issue for us to deal with and we are now focusing our attention on having in place the plans that will ensure Lloyd's continues trading across Europe”
8/11 Colm Kelleher
President of US bank Morgan Stanley says City of London ‘will suffer’ as result of the EU referendum: “I do believe, and I said prior to the referendum, that the City of London will suffer as result of Brexit. The issue is how much”
9/11 Richard Branson
Virgin founder believes we've lost a THIRD of our value because of Brexit and cancelled a deal worth 3,000 jobs: We're not any worse than anybody else, but I suspect we've lost a third of our value which is dreadful for people in the workplace.' He continued: "We were about to do a very big deal, we cancelled that deal, that would have involved 3,000 jobs, and that’s happening all over the country"
10/11 Barack Obama
US President believes Britain was wrong to vote to leave the EU: "It is absolutely true that I believed pre-Brexit vote and continue to believe post-Brexit vote that the world benefited enormously from the United Kingdom's participation in the EU. We are fully supportive of a process that is as little disruptive as possible so that people around the world can continue to benefit from economic growth"
11/11 Kristin Forbes
American economist and an external member of the Monetary Policy Committee of the Bank of England argues that the economy had been “less stormy than many expected” following the shock referendum result: “For now…the economy is experiencing some chop, but no tsunami. The adverse winds could quickly pick up – and merit a stronger policy response. But recently they have shifted to a more favourable direction”
“We suspect both the economy and the labour market will be increasingly pressurised by mounting uncertainties over the coming months – particularly once the Government triggers Article 50 and likely very difficult negotiations with the EU come increasingly to the forefront,” said Howard Archer of IHS Global Insight.
“Consequently, we see the unemployment rate starting to trend up before too long and suspect that it could reach 5 per cent by the end of 2016, 5.6 per cent by the end of 2017. We see it rising further to 5.9 per cent by the end of 2018.”
Official inflation figures yesterday showed a jump to 1 per cent in September.
Analysts expect inflation to rapidly overshoot the Bank of England’s 2 per cent target as the impact of the falling pound feeds through into shop prices, squeezing the purchasing power of wages.Reuse content