UK ILO Unemployment Rate drops to 3.8% in April vs. 4.0% expected
|- The UK Unemployment Rate unexpectedly drops to 3.8% in the three months to April.
- The Claimant Count Change for Britain arrived at -13.6K in May.
- The UK Average Earnings excluding bonuses rose 7.2% YoY in April vs. the 6.9% increase expected.
According to the latest data published by the Office for National Statistics (ONS) on Tuesday, the United Kingdom’s (UK) ILO Unemployment Rate inched lower to 3.8% in the quarter to April from the 3.9% recorded in the three months to March, beating the market consensus of a 4.0% print.
The Claimant Count Change also showed a bigger-than-expected decline. The number of people claiming jobless benefits dropped by 13.6K in May, compared with the expected decrease of 9.6K. The Claimant Count Change unexpectedly jumped by 23.4K (an upward revision from 46.7K) in the previous month.
The UK’s average weekly earnings, excluding bonuses, arrived at 7.2% 3Mo/YoY in April versus 6.8% prior and 6.9% expected. The gauge including bonuses came in at 6.5% 3Mo/YoY in the fourth month of the year versus 6.1% previous and 6.1% expected.
It’s worth noting that the April data includes the impact of a 9.7% rise in the minimum wage and, therefore, will be closely analyzed by the Bank of England (BoE) as it stays committed to tame inflation.
Key points (via ONS)
In May 2023, 23,000 more people were in payrolled employment when compared with April 2023.
National statistics says inactive workers because of long-term sickness hits new record high.
UK May payrolls change 23k vs -135k prior.
The UK Minister for Employment, Guy Opperman MP told FXStreet: "Our drive to get more people into work and grow the economy has seen inactivity fall for the fifth month in a row. Vacancies continue to drop, employment is up and the numbers on company payrolls are also up.”
“We’re investing £3.5 billion to remove barriers to work - with extra support for people with health conditions, an expansion of free childcare and arming jobseekers with the skills they need through tailored training and extra work coach time,” the Minister added.
GBP/USD reaction
GBP/USD extends its recovery momentum and scales 1.2550 after the mixed UK employment data. The pair is trading 0.40% higher on the day at 1.2558, as of writing.
About UK jobs
The UK Average Earnings released by the Office for National Statistics (ONS) is a key short-term indicator of how levels of pay are changing within the UK economy. Generally speaking, positive earnings growth anticipates positive (or bullish) for the GBP, whereas a low reading is seen as negative (or bearish).
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