Surprise rise in unemployment suggests jobs market slowdown
The UK jobs market has showed signs of slowing after the rate of unemployment suddenly went up in the June to August period.
According to official figures, the rate of unemployment rose by 0.1 per cent over the three months from June to August, reaching 3.9 per cent overall.
In real terms, the number of people in work fell by 56,000 over the period, contrary to forecasts from economists which suggested that a 26,000 rise in employment would come.
The Office for National Statistics said: “The UK labour market showed signs of slowing in the three months to August 2019.”
Although the unemployment rate remains near a 44-year low, a leading ONS statistician added that employment growth had “cooled”, amid a fall in the number of young people in work.
Matt Hughes, the ONS head of labour market statistics, said: "The employment rate is still rising year-on-year, but this growth has cooled noticeably in recent months.
"Among the under-25s, the employment rate has actually started to fall on the year.”
A total of 32.69 million are thought to be in employment after the fall over the period, with the number of unemployed up by 22,000 to a total of 1.31 million.
This coincides with a fall in job vacancies, which are now at near two-year low of 813,000, the lowest since the three months to November 2017.
Experts have suggested that Brexit uncertainty is prompting firms to hold back on hiring, while weak growth in the economy is impacting activity in the labour market.
Thomas Pugh of Capital Economics said: "This is further evidence that the underlying weakness in economic growth is restraining labour market activity.
"However, it could also be evidence that the uncertainty around Brexit is starting to impact firms' hiring decisions. The survey evidence is consistent with a further softening in employment and wage growth going forward too.”
Meanwhile, wages are still outpacing the rate of inflation with earnings growing by 3.8 per cent annually.