UK unemployment rate holds steady in May, payrolls decline again in June
- May ILO unemployment rate 4.9% vs 5.0% expected
- Prior 4.9%
- May employment change 147k vs 80k expected
- Prior 100k
- May average weekly earnings +4.3% vs +4.5% 3m/y expected
- Prior +4.4%
- May average weekly earnings (ex bonus) +3.4% vs +3.4% 3m/y expected
- Prior +3.4%
- June payrolls change -4k
- Prior 2k; revised to 3k
As a reminder, the numbers here are still based on the Labour Force Survey (LFS) with that having data quality issues as the survey transition is delayed. And that remains the number one caveat that ONS is pinning on their labour market report this month.
The headline estimate points to the UK jobless rate keeping steady in May at 4.9%. So far this year, the figure is up 0.2% with UK economic inactivity rate estimated to have fallen by 0.1% year-to-date to 20.9%.
That matches up with the payrolls figure, which dipped again in June, dropping by 71,000 (0.2%) so far this year.
All in all, it still points to some softening in the UK labour market but not quite as pronounced to warrant immediate worries by the BOE.
Besides that, pay growth continues to show a bit of a divergence total pay keeping above 4% but regular pay holding at 3.4% after the continued dip since January. In terms of real pay growth, total pay has bounced back to 1.1% from a low of 0.6% in the three months to February. Meanwhile, regular pay remains subdued at 0.3% only.
So, that still points to some mixed developments on price pressures – which now have to be taken with a rebound in energy prices amid the US-Iran conflict starting up again.
This article was written by Justin Low at investinglive.com.