Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
Britain’s unemployment rate has risen to its highest level since early 2016, as the Covid-19 pandemic continues to hit the labour market – particularly younger workers.
But, there are also signs that the jobs market is stabilising, with a small increase in the number of payrolled employees in December and January, and a pick-up in vacancies.
The UK jobless rate rose to 5.1% in the last three months of 2020, according to the latest official labour market figures. That’s up from 5% a month earlier — and just 3.8% at the end of 2019.
It’s the highest in almost five years, but the jobless rate is still lower than during the financial crisis a decade ago (with the furlough scheme cushioning the impact of the lockdown.).
The Office for National Statistics reports that since February 2020, the number of payroll employees has fallen by 726,000 — showing the scale of last year’s job losses.
Encouragingly, though, 83,000 more people were in payrolled employment in January than in December, the second monthly increase in a row after the November national lockdown.
The number of vacancies also rose at the end of 2020, but there are still only three-quarters as many opportunities as a year ago.
Employees at the start of their careers have born the brunt of the pandemic job losses, as the ONS says:
New analysis by age band shows that the 18 to 24 years age group has seen the greatest decrease in payrolled employees since February 2020.
The ONS also reports that, in October to December 2020, there were 32.39 million people aged 16 years and over in employment, 541,000 fewer than a year earlier. This was the largest annual decrease since May to July 2009.
Here are the key points from the report:
- In January 2021, 83,000 more people were in payrolled employment when compared with December 2020; this is the second consecutive monthly increase.
- In January 2021, 726,000 fewer people were in payrolled employment when compared with February 2020.
- The UK employment rate, in the three months to December 2020, was estimated at 75.0%, 1.5 percentage points lower than a year earlier and 0.3 percentage points lower than the previous quarter.
- The UK unemployment rate, in the three months to December 2020, was estimated at 5.1%, 1.3 percentage points higher than a year earlier and 0.4 percentage points higher than the previous quarter.
- The redundancy rate, in the three months to December 2020, was estimated at 12.3 people per thousand employees.
- The Claimant Count increased in January 2021, to 2.6 million; this includes both those working with low income or hours, and those who are not working.
- There were an estimated 599,000 vacancies in the UK in November 2020 to January 2021; this is 211,000 fewer than a year ago and 64,000 more than the previous quarter.
More reaction to follow…
Also coming up
Worries about rising inflation and predictions of a commodities super-cycle are driving the markets right now, with copper prices at their highest level in over nine years.
America’s top banker, US Federal Reserve chair Jerome Powell, will testify to Congress later today. He’s expected to tell US Senate banking committee that the Fed remains committed to its stimulus programme. But, with US government bond yields rising, could the Fed be forced to tighten policy sooner than planned?
- 7am GMT: UK unemployment report for the three months to December
- 10am GMT: Eurozone inflation report for January
- 11am GMT: CBI distributive trades survey of UK retail in February
- 2pm GMT: US house price index for December
- 3pm GMT: US Federal Reserve chair Jerome Powell testifies to Congress