Figures show fall in jobless rate is slowing

Official jobs figures are today expected to show the rate at which unemployment in the UK is falling slowed in the three months to June.

The number of unemployed, including those not eligible for Jobseeker's Allowance, is expected to have fallen by around 10,000 in the quarter to about 2.44 million.

This compares with a drop of 26,000 in the three months to May and an 88,000 plunge in the quarter to April. This means the unemployment rate in the UK will remain around 7.7%.

Elsewhere, the Office for National Statistics figures are expected to show an increase in those claiming JSA, with the count increasing by 19,900 in July, a rise of 4.8%.

Average weekly earnings in the three months to June are expected to have increased at a mediocre 2.4% - a slight improvement on the previous increase of 2.3%.

Muted wage growth in the UK is combining with soaring inflation - which increased to 4.4% in July from 4.2% in June - and squeezing household budgets.

Victoria Cadman, economist at Investec, said: "Last month's labour market report presented a diverging picture with the claimant count rising in June and data showing a fall in unemployment in the three months to May.

"We tend to the view that this reflects the shift in the benefits system away from income support toward Jobseeker's Allowance, thereby adding to the claimant count, which is measured by JSA.

"We expect a similarly divergent story will play out in today's report."

The UK's employment rate is struggling to return to pre-recession levels, the TUC warned earlier this week.

Employment levels across the UK in April 2011, the latest available figures, were down 0.5% on pre-recession levels, the TUC said.

A report from the ONS last month revealed the South East suffered the lowest rise in unemployment during the recession while the West Midlands was hit by the biggest increase.

The jobless figures reached a low point in 2005 but every region of the UK saw unemployment rise during the 2008/9 recession.

PA