News UK

UK unemployment rate hits five-year high as wage growth slows

These figures could lead the Bank of England to decide it will cut interest ratespublished at 08:24 GMT

Theo Leggett
International business correspondent

Slow economic growth in the second half of last year, and a late November Budget, contributed to what the ONS describes as weak hiring activity.

The number of people on company payrolls fell by 130,000 across the year to December, while more people who were out of work were actively looking for a job, pushing the unemployment rate up to a near five-year high.

Average pay grew by 4.2%, down from 4.7% in the previous survey – with public sector wages still growing much faster than those in the private sector.

Economists say the latest figures would reinforce expectations that inflation will fall back, making it likely the Bank of England would choose to cut interest rates soon, possibly at its next rates-setting meeting in March.

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