A mixed set of economic data reveals that the number of individuals deemed economically inactive due to long-term illness has reached an all-time high.
In the three months preceding February, the unemployment rate in the United Kingdom increased to 3.8%, according to official data that also revealed a faster-than-anticipated increase in wage growth.
The Office for National Statistics (ONS) reported that the unemployment rate rose from 3.7% to 3.9% due to an increase in the number of long-term unemployed.
Even though part-time employees and self-employed laborers drove an increase in the employment rate, the rate increased.
In March, the number of individuals claiming unemployment benefits increased by 28,200, indicating that the unemployment rate will likely continue to increase.
In the three months before March, the number of job openings decreased by an additional 47,000 to 1.1 million.
This, according to the ONS, reflects “uncertainty across industries, as respondents continue to cite economic pressures as a reason for delaying recruitment.”
In the three months before February, total pay, including bonuses, increased by 5.9% annually.
Energy-driven inflation was above 10%, a 40-year high, and this was an increase from 5.7% the month before.
Currently, the rate of inflation is 10.4%.
At 6.6%, regular wage growth was stagnant.
Wage growth is a key signal of the cost-of-living dilemma, not just for budget-conscious consumers.
As pay-related strikes continue in the NHS and other sectors, the Bank of England advises wage restraint.
Wage rises that match inflation may boost demand and raise prices.
In May, policymakers will meet again. By then, we will know if inflation has reached a single-digit level.
ONS statistics showed that public and private sector salary increases closed as more settlements were achieved.
Since the COVID-19 epidemic, the economic inactivity rate has dropped to 21.1%.
All ages responded to government initiatives to encourage more people back to work, but students led.
The ONS data revealed that the number of inactive individuals due to long-term illness reached an all-time high.
While unemployment remains near historic lows, rising prices continue to chew away at paychecks, which is why cutting inflation in half this year is one of our top economic priorities.
“To help families in the interim, we are increasing the National Living Wage by a record amount and providing cost-of-living assistance worth an average of £3,300 per household this year and last, funded by windfall taxes on energy profits.”
The shadow chancellor, Rachel Reeves, stated that the Conservatives had held the country back.
She responded, “Their lack of ambition for Britain is causing real wages to fall, families to become worse off, hundreds of thousands of people to lose their jobs, and our economy to lag.”
