Britain’s jobless rate has fallen to its lowest level for over 47 years but workers have seen their pay fall further behind rocketing inflation, according to official figures. The rate of unemployment dropped to 3.7% in the three months to March – the lowest since October to December 1974, the Office for National Statistics (ONS) said.
For the first time, there were fewer unemployed people than job vacancies, although the fall in the rate was also down to a rise in the number of people dropping out of the jobs market, the figures showed. The ONS also laid bare the scale of the mounting cost-of-living crisis, revealing that regular pay excluding bonuses dropped by 2.9% in March when taking Consumer Prices Index (CPI) inflation into account – the biggest fall since November 2011.
In the three months to February, real regular pay was 2% lower, the steepest decline since 2013.
It comes in spite of another pick up – of 4.2% – in regular average pay in the quarter.
Pay including bonuses jumped 7% and was up 9.9% in March as firms ramped up rewards for staff amid a booming jobs market.
The latest ONS labour market data also confirmed another rise in the number of UK workers on payrolls, up 121,000 between March and April to 29.5 million.
Darren Morgan, director of economic statistics at the ONS, said the data showed a “mixed picture for the labour market”.
He said: “Total employment, while up on the quarter, remains below its pre-pandemic level.
“Since the start of the pandemic, around half a million more people have completely disengaged from the labour market.”
He added: “Indeed, with the latest fall in unemployment, to its lowest rate since 1974, there were actually fewer unemployed people than job vacancies for the first time since records began.”
