Real incomes tumble despite further increase in UK employment

Total unemployment has fallen but the number of those out of work and eligible to claim benefit is o

Total unemployment has fallen but the number of those out of work and eligible to claim benefit is on the increase, according to official figures. Picture: PA - Credit: PA

Employment in the UK has reached another record high but pay has fallen further behind the rate of inflation, according to new figures.

Nearly 32m people were in work in the three months to April, the highest since records began in 1971, while total unemployment fell by 50,000 during the quarter to 1.53m, the lowest for more than a decade.

However, the Office for National Statistics (ONS) also reported a fall in real earnings with average pay growing by 2.1% in the year to April – down from with a rise of 2.3% in the year to March and well short of the latest inflation figure of 2.9% published earlier this week.

Matt Hughes, senior statistician at the ONS, said that pay had fallen in real terms year-on-year, whether or not bonuses are taken into account.

There was further bad news with the narrower count of those out of work and eligible to claim benefit rising on a seasonally-adjusted basis for the third month in a row in May, to 802,600.

On an unadjusted basis, however, the claimant was around 9,000 lower compared with April and most parts of Suffolk and north Essex followed this trend.

Two districts in Suffolk did see an increase although in each case the unemployment rate (claimants as a percentage of the total workforce) remained unchanged. Waveney saw the bigger increase, up 40 to 2,380 (representing a rate of 3.6%), with the count in St Edmundsbury edging higher by five to 790 (1.2%).

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The biggest falls, cutting the local jobless rate by 0.1 of a percentage point in each case, were in Ipswich, where the count fell by 90 to 1,825 (2.1%), and Babergh, where the figure fell by 10 to 430 (enough to nudge the rate down to 0.8%).

Smaller falls, relative to the size of the workforce, left the rates unchanged in Forest Heath, down 25 to 340 (0.9%), Suffolk Coastal, down 20 to 490 (0.7%), and Mid Suffolk, down 10 to 490 (0.8%).

In north and mid Essex there was an across-the-board fall in claimant counts. The biggest decreases, cutting the jobless rate by 0.1 in each case, were in Tendring, down 90 to 2,140 (2.8%), and Chelmsford, down 65 to 1,210 (1.1%).

Smaller falls left the rates unchanged in Braintree, down 35 to 1,000 (1.1%), Colchester, down 15 to 1,410 (1.2%), Maldon, down 15 to 370 (1.0%), and Uttlesford, down five to 255 (0.5%).

New Work and Pensions Secretary David Gauke said: “This Government wants to give everyone the opportunity to succeed, regardless of where they live or their background.

“This is yet another strong set of record-breaking figures, with employment up and unemployment down, fuelled by full-time opportunities. This is good news for families as we continue to build a stronger, fairer Britain.”

However, TUC general secretary Frances O’Grady said: “Real wages have fallen for the second month in a row. Unless the Government gets its act together, we’ll soon be in the middle of another cost of living crisis.”