UK unemployment rate drops to 6%, lowest level since 2008
UK unemployment has fallen to its lowest level since 2008, when the fall of the US investment bank Lehman Brothers brought the global economy to the brink of collapse.
In a pre-election boost to the UK government, the number of unemployed people fell to 1.97 million between June and August after the largest annual fall since records began in 1972.
It was the first time below the 2 million mark since the three months between September and November 2008, according to the Office for National Statistics.
David Cameron said: “The biggest-ever fall in unemployment in history, taking it below 2 million, is great news. Our plan is working, but there’s still much more to do.”
The number of unemployed people was 538,000 lower on an annual basis.
The jobless rate in Britain fell by more than City economists had been expecting, to 6% in the three months to August, from 6.2% in the quarter to July. The forecasts had been 6.1%. The last time the unemployment rate was lower than 6% was in August 2008, when it was 5.9%.
Pay increased by 0.7% over the three months, compared with a year earlier, prolonging the fall in real pay as wage growth continued to lag inflation. It was, however, a slight improvement on the 0.6% pay growth between May and July.
Pay growth excluding bonuses was 0.9%, up from 0.8%.
Frances O’Grady, the TUC general secretary, said UK workers had been excluded from the recovery. She said: “The real value of wages has fallen again this month. This is not only the longest and deepest pay cut on record, but there is no end in sight.”
Rachel Reeves, the shadow work and pensions secretary, said: “Today’s fall in overall unemployment is welcome, but the new figures show working people are continuing to see their pay fall far behind the cost of living.”
Economists said the fall in unemployment masked other signs that the jobs market was weakening. John Philpott, director of The Jobs Economist consultancy, said the fall to below 2 million was partly explained by the rise in the number of economically inactive people, describing those who are unemployed but not seeking or available for work. The number jumped by 113,000 over the quarter to 9.03 million people. Almost half of the rise was down to an increase in the student population.
