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UK jobs market shines, but clouds on horizon

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UK jobs market shines, but clouds on horizon

By Andy Bruce, David Milliken

 

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FILE PHOTO: A pedestrian walks past an employment centre in London August 17, 2011. REUTERS/Suzanne Plunkett//File Photo

 

LONDON (Reuters) - Britain’s labour market showed unexpected strength in the second quarter, in sharp contrast with figures last week that showed the economy contracted over the same period as the country gears up for Brexit.

 

Total earnings growth including bonuses rose by an annual 3.7% in the three months to June - the highest rate since June 2008 and up from 3.5% in May, and in line with forecasts in a Reuters poll of economists.

 

The jobs market has been a silver lining for the economy since the Brexit vote in June 2016, something many economists have attributed to employers preferring to hire workers they can later lay off rather than making longer-term commitments to investment.

 

Tuesday’s figures showed Britain created 115,000 jobs in the second quarter, bringing the level of employment to a record 32.811 million, the Office for National Statistics (ONS) said.

 

“The jobs market remains a source of strength for the UK economy, though it may now be reaching its peak,” said Tej Parikh, chief economist at the Institute of Directors.

 

Sterling showed little reaction to the data, which tend to lag broader trends in the economy and had also appeared healthy in the lead-up to the financial crisis.

 

Excluding bonuses, annual pay growth picked up to 3.9% from 3.6%, the ONS said, compared with the poll forecast for growth of 3.8%.

 

A little of the strength in the pay data reflected the unusual timing of annual pay rises for public health workers in 2018, when a larger-than-normal increase was deferred until July.

 

Some details pointed to tougher times ahead, after data last week showed the economy unexpectedly shrank by 0.2% in the three months to June.

 

The unemployment rate rose to 3.9%, against expectations for it to hold steady 3.8%, and while employment growth far exceeded forecasts, part-time rather than full-time jobs accounted entirely for the increase.

 

Output per hour, the headline measure of productivity, fell 0.6% in annual terms - the fourth quarter of decline in a row and the longest such run since mid-2013.

 

Poor productivity is one of Britain’s biggest economic challenges and, until recently, had contributed to a decade of weak pay growth.

 

The number of job vacancies, an indicator of future employment, fell to 820,000 in the three months to July from 824,000 in the period to June, the lowest level in more than a year.

 

Some recent surveys of companies have suggested employers are turning more cautious about hiring as new Prime Minister Boris Johnson has pledged to take Britain out of the European Union on Oct. 31, with or without a deal.

 

The Bank of England said this month it saw signs of a softening in labour market indicators.

 

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-- © Copyright Reuters 2019-08-13
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My God but you're busy, Chomps.

 

I suppose the appropriate answer to  "Leave hasn't happened yet" is "Neither has Remain".  And long may it Remain that way....

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A fair use baiting/troll post has been removed

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Its shining brightly from zero hour contracts and more foodbanks from the multitude of programmes I see like skint, broke not broken🤔

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Quite honestly, with the debt that government, corporations and the public owe there are only two alternatives....1) renege in the debt and if many countries do it, there will still be loans available to countries who default, this will however force up interest rates and cause tax increases....or 2) induce massive inflation to inflate away the debt by holding interest rates at near zero....this is what the central banks are trying to do and succeeding in the UK with large above inflation pay award. This approach robs savers and the prudent. 

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3 hours ago, blazes said:

"Neither has Remain".

Only by remaining could UK vote in the latest EU elections.

Only by remaining is there no hard border between the Republic of Ireland and Northern Ireland.

Etc.

It was the UK that asked for an extension not to leave yet. Perhaps in hindsight the EU should have denied the request.

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21 minutes ago, Srikcir said:

Perhaps in hindsight the EU should have denied the request.

They couldn't afford to.

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2 hours ago, baansgr said:

The emploment market is at its best since records began 50 years ago. Ive relocated back to UK after 15 years in Thailand.  Back for a few weeks disposing of vehicles and chattels. Already offered emplotment within two weeks of resettling. The UK is booming regardleas of Brexit and dare I say Brits are reasonably happy with eveeything including the forthcoming Brexit. Different to the downhearted ambience in Thailand.

I found the same thing when I was back there. Shopping malls packed, couldn't get a seat at restaurants without booking, new cars everywhere. I was expecting doom and gloom but in hindsight maybe I'd read too many Guardian/Reuters articles trying to talk the UK into recession.

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