Labour market | UK unemployment rate falls to 4.9%

UK unemployment rate falls to 4.9%

The UK unemployment rate has begun to fall as the jobs market has started to show signs of improvement.

New figures from the Office for National Statistics (ONS) have revealed that the unemployment rate fell to 4.9% in the three months to February, down slightly from five per cent in the three months to January.

These signs of improvement came before the easing of lockdown restrictions earlier this month, where outdoor hospitality and the retail industry opened once again. It also marks the first quarterly decrease since the last quarter of 2019.

During March and early April there was a rise in online job adverts as employers in the hospitality sector started to hire staff ahead of April 12, 2021, when the industry opened its doors to customers outside only.

These job figures have been branded as “the most positive set” according to Gerwyn Davies, Senior Policy Adviser at the CIPD. He said: “These are the most positive set of jobs figures since the start of the pandemic. It would be wrong to conclude that unemployment won’t continue to rise modestly for much of 2021, but the data suggests that unemployment may be close to peak.”

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But he warned that there is no room for complacency as the furlough scheme comes to an end. “The hope is that the increase in economic activity in the worst-affected sectors will generate enough jobs over the coming months to offset the impending closure of the Government’s furlough scheme,” he explained.

“However, without intervention on skills and against the backdrop of new migration restrictions, the UK economy is at risk of sleepwalking into a labour supply crisis.”

Supporting temporary workers

According to ONS figures, the number of temporary workers was up by 5.4% on the previous quarter, which signifies the importance of these workers when it comes to helping to build a strong labour market.

This is a notion that REC Chief Executive Neil Carberry supports, as he said: “The number of temporary workers was up by 5.4% on the previous quarter – yet again demonstrating the huge importance of temporary work helping to maintain a strong labour market despite the pandemic. The role of temporary work in supporting incomes has been a constant of the pandemic.”

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He added that to support the UK’s recovery following the pandemic, a reform of the Apprenticeship Levy is vital.

“We now need to look to how we support this recovery. A reform of the Apprenticeship Levy to support retraining for older workers and opportunity for younger workers – who have been particularly hard hit – is now essential,” he concluded.

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