Wednesday, February 28, 2024
HomeboeUK Jobless Rate Rises to 4.2% in Q3, Suggesting Cooling Jobs Market

UK Jobless Rate Rises to 4.2% in Q3, Suggesting Cooling Jobs Market

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The rate of UK unemployment has risen to 4.2% in the three months leading up to the end of August, according to new data from the Office for National Statistics (ONS). The ONS also reported that the number of people in employment fell by 0.3 percentage points to 75.7%, suggesting a cooling in the country’s jobs market.

The ONS stated that the number of job vacancies has also dropped below one million, standing at 988,000, which marks the 15th consecutive quarterly fall. The figures were delayed by a week due to low response rates to the survey and the implementation of a new methodology.

Marcus Brookes, the chief investment officer at Quilter Investors, commented on the use of new data, stating that it has given a “slightly clouded” picture of the state of the labor market. Brookes added that while the experimental data shows stable unemployment rates for now, the fast rise in interest rates is beginning to have an impact. Companies are scaling back on hiring and, in some cases, shedding jobs. With economic growth in the UK slowing and the potential for negative growth in the fourth quarter, today’s data is seen as a sign that a downturn may be on the horizon.

Brookes also noted that the figures may provide enough evidence for the Bank of England to hold the UK base interest rate at 5.25% when its monetary policy committee meets next.

This update on the UK jobs market comes as Barclays announces plans for further cost-cutting after reporting a 4% drop in profits during the third quarter. The bank attributed the decline to a decrease in profits at its corporate investment bank, which fell by 11%. This is despite Barclays’ involvement in the $65 billion stock market debut of Cambridge-based chip maker, Arm, in the US.

In other news, Google parent company Alphabet and Microsoft are set to release their financial results in the US later today.

Overall, these latest figures from the ONS suggest that the UK’s jobs market is experiencing a downturn, with rising unemployment and a decrease in the number of people in employment. As economic growth in the UK slows, businesses are scaling back on hiring and cutting costs, leading to a potentially challenging period ahead. However, the data may provide a basis for the Bank of England to maintain the current interest rate, providing some stability in uncertain times.

More detail via The Guardian here… ( Image via The Guardian )

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