UK unemployment rises and pay growth falls

The number of people out of work in Britain increased for the first time in seven months in February.4096

In a signal that the European Union referendum vote in June is having an impact on the economy, the latest labour market report showed that the unemployment total rose by 21,000 in the three months to February to 1.7 million.

This was the first increase since last August but left the headline unemployment rate unchanged at 5.1%. The claimant count, which measures people receiving out of work benefits, jumped by 6,700 in March. This is also the first increase since August 2015.

In a further blow to the government’s efforts to keep the economy growing strongly, wagegrowth including bonuses fell from 2.1% in January to 1.8% . The measure of wages excluding bonuses remained at 2.2%.

Analysts blamed a fall in City bonuses at the end of the financial year for much of the fall, but the economy has relied heavily on consumer spending to keep high street tills ringing and business services growing, so any fall is likely to hit GDP growth in the first quarter.