UK jobless rate holds at lowest since 1975

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LONDON, ENGLAND - JULY 07: British Home Secretary and Conservative leadership contender Theresa May waves outside the Houses of Parliament on July 7, 2016 in London, England. Theresa May has the backing of 199 fellow MPs after the second ballot for the leadership of the Conservative Party. Receiving 84 votes, Andrea Leadsom MP joins May on the shortlist presented to the Conservative Party members and Michael Gove was eliminated with 46 votes. (Photo by Jack Taylor/Getty Images)

Britain’s unemployment rate remains at a 42-year low, official data showed Wednesday, but workers’ wages are still being eroded by inflation.

The jobless rate — or the proportion of the workforce that is unemployed — stood at 4.3 percent in the three months to the end of October, the Office for National Statistics (ONS) said in a statement.

That was unchanged from the three months to September, and the lowest rate since 1975.

Average weekly earnings rose by 2.5 percent year-on-year in the three-month period to October, but lagged behind Britain’s annual inflation rate of 3.1 percent.

Adjusted for inflation, workers’ weekly earnings fell 0.4 percent year-on-year from August to October — a further erosion of purchasing power.

Britain’s Consumer Prices Index 12-month inflation rate hit a near six-year high last month, fuelled by the rising cost of air fares, computer games and recreational goods, the ONS revealed on Tuesday.

Inflation has soared in 2017 as a Brexit-hit pound ramps up import costs, which led the Bank of England to raise its key interest rate for the first time in a decade last month.

“The consumer squeeze which has been evident since last year’s referendum continues, as pay adjusted for inflation is still falling,” noted Hargreaves Lansdown economist Ben Brettell.

Sterling tumbled in the wake of last year’s shock Brexit referendum, while Britain is on course to leave the European Union in March 2019.

Some 1.4 million people were unemployed at the end of October. That was down 26,000 on a year earlier.

The BoE is expected Thursday to leave borrowing costs at 0.50 percent following its final monetary policy committee (MPC) meeting of 2017.

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