Global| Apr 16 2004UK Employment Up, Unemployment Down in Latest 2 Monthly Reports
Summary
Labor market conditions in the UK have improved markedly in the most recent months. The number of people employed ("labor force employment" in the table below) jumped 120,000 in the December reporting period and another 58,000 in the [...]
Labor market conditions in the UK have improved markedly in the most recent months. The number of people employed ("labor force employment" in the table below) jumped 120,000 in the December reporting period and another 58,000 in the January period, which was published today. All these data except the Claimant Count are reported as 3-month centered moving averages; that is, the new January data are the average of December, January and February. The series begin in April 1992.
As jobs have increased, unemployment has decreased, with the unemployment rate reaching 4.8% in December and January, an all-time low. Labor force participation has increased, with the so-called "economic activity rate" climbing to an all-time high of 63.2% of the population over age 16. Unemployment is thus down because of the gain in jobs, not, as sometimes happens, because people are backing away from the labor force. Note that claims for the "Jobseeker's Allowance" have also declined.
At the same time, earnings have increased markedly. The "headline rate" for 12-month gains in average earnings jumped by 1.5 percentage points over the last two months. It is seen that the surge is entirely due to higher bonuses; this is a stark shift from earlier periods in 2001 and 2002, when decreasing bonuses meant workers with bonuses actually saw weaker compensation gains than workers with straight earnings alone.
| UK: Selected Labor Market Indicators |
"Feb" (3 months ended Mar) |
"Jan" (3 months ended Feb) |
"Dec" (3 months ended Jan) |
Year Ago ("Jan") | 2003 | 2002 | 2001 |
|---|---|---|---|---|---|---|---|
| Unemployment Rate (%) | N.A. | 4.8 | 4.8 | 5.1 | 5.0 | 5.2 | 5.1 |
| Claimant Count (thous.) | 882.2* | 886.4* | 891.7* | 942.3* | 933.2 | 946.7 | 969.9 |
| Labor Force Employment (thous.) | N.A. | 28,330 | 28,272 | 28,012 | 28,111 | 27,865 | 27,668 |
| Change (thous.) | N.A. | 58 | 120 | 2 | 246 | 197 | 218 |
| Average Earnings Index: "Headline Rate" Including Bonuses (Yr/Yr %Chg) | N.A. | 4.9 | 4.7 | 3.6 | 3.4 | 3.5 | 4.6 |
| Average Earnings Index Excluding Bonuses (Yr/Yr %Chg) | N.A. | 3.9* | 3.9* | 4.0* | 3.6 | 4.0 | 4.8 |
Carol Stone, CBE
AuthorMore in Author Profile »Carol Stone, CBE came to Haver Analytics in 2003 following more than 35 years as a financial market economist at major Wall Street financial institutions, most especially Merrill Lynch and Nomura Securities. She has broad experience in analysis and forecasting of flow-of-funds accounts, the federal budget and Federal Reserve operations. At Nomura Securites, among other duties, she developed various indicator forecasting tools and edited a daily global publication produced in London and New York for readers in Tokyo. At Haver Analytics, Carol is a member of the Research Department, aiding database managers with research and documentation efforts, as well as posting commentary on select economic reports. In addition, she conducts Ways-of-the-World, a blog on economic issues for an Episcopal-Church-affiliated website, The Geranium Farm. During her career, Carol served as an officer of the Money Marketeers and the Downtown Economists Club. She has a PhD from NYU's Stern School of Business. She lives in Brooklyn, New York, and has a weekend home on Long Island.
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