Unemployment rate unchanged in December, while vacancies continue to fall in latest quarter. UK pay growth rose in December and unemployment remained unchanged despite warnings from business that Rachel Reeves’s autumn budget would lead to job losses. Figures from the Office for National Statistics show annual growth in total average weekly earnings rose by 6% in the three months to December, up from 5.6% in November and above a 5.9% forecast made by City economists.
Regular pay, excluding bonuses also accelerated from 5.6% to 5.9%, matching estimates. Unemployment remained unchanged at 4.4%, confounding expectations for a marginal increase to 4.5%. Liz McKeown, an ONS director of economic statistics, said: “Growth in pay, excluding bonuses, rose for a third consecutive time, with increases seen in both the private and public sector. After taking account of inflation, real pay growth also increased slightly.
“The number of employees on payroll was broadly unchanged in the last three months of the year, continuing a medium-term trend of slowing growth. The number of vacancies also continued to fall in the latest quarter, albeit more slowly, with the total number remaining a little above its pre-pandemic level.”. The figures come as business leaders issued a warning that Reeves’s planned £25bn increase in employers’ national insurance contributions and 6.7% rise in the minimum wage from April could force them to cut jobs.
Employers’ surveys show companies are preparing for the biggest round of redundancies in a decade amid collapsing business confidence as firms brace for the changes due to be made in April. Earlier this month the Bank of England halved its growth forecasts for the UK economy and said households would come under renewed pressure from rising inflation. It cut interest rates from 4.75% to 4.5%. The ONS has cautioned there are issues with the quality of the UK’s official jobs market statistics, which experts have warned leaves policymakers “flying blind” with the prospect that decisions are being taken based on flawed data.
Sign up to Business Today. Get set for the working day – we'll point you to all the business news and analysis you need every morning. after newsletter promotion. Liz Kendall, the work and pensions secretary, said: “Since July wages have continued to grow at pace, putting vital money back in people’s pockets as we work to make work pay and improve living standards for all. “But these figures also show that too many people are being locked out of work and denied that chance, including those sick and disabled. Instead of writing people off and labelling them, we must step up our support.”.
