John Ashcroft, the UK economic expert and the Saturday Economist, is reporting good news from the jobs market this week as earnings rise and unemployment stands at 4%.
The unemployment rate in December was just 4%. The number out of work was 1.36 million down by 100,000 compared to prior year.
The number in work was 32.6 million, up by 440,000 compared to December 2017. There were an estimated 844,000 on zero hours contracts in their main job, down by almost 60,000 over the same period.
More people in work, earning more money. Whole economy earnings were up by 3.4% in the three months to December. Private sector pay was up by 3.5%. Public sector pay was 2.8%. Construction pay was up by 4.3%, a measure of jobs compression in the sector.
The good news for Brexiteers, workers from the EU are returning home. The number of EU workers fell by 60,000 to 2.3 million by end of year. Not so good news for those taking back control of our borders, numbers from Africa and Asia increased to plug the gap. As with all things, be careful what you wish for.
Wages are rising ahead of inflation. Real income growth in the first quarter this year will be 1.5%. Recruitment difficulties are increasing. The number of vacancies in the economy increased to 870,000. That is a remarkable number when we consider the peak at previous cycle was just 700,000.
Recruitment difficulties are particularly high among leisure, health and social workers. They also appear to be acute in the financial and insurance sectors. A sector deemed to be vulnerable to Artificial Intelligence.
A jobs market which is overheating with wage growth ahead of inflation. This is not a sign of an economy which is about to keel over any time soon. Brexit remains a real threat to the UK and European economy. Self inflicted wounds are the most harmful.
Brexit together with Trump trade wars and the Tariff Man’s penchant for punitive action, the clear and present danger to healthy world growth. It is time to make the deals and let the good times roll …
Thanks to John Ashcroft, Saturday Economist, for providing his Expert Opinion