- Unemployment in the three months to January holds steady at 4.4%
- Closely watched pay growth data held at 5.9%
- Vacancy numbers remain broadly flat
Danni Hewson, AJ Bell head of financial analysis, comments on the latest UK jobs figures:
“Picking our way through the UK’s jobs data has become tricky. Not only are we having to consider how reliable the numbers really are because of the health warnings from the ONS about small sample sizes, but we’re also hyper aware that the changes to labour costs announced in last year’s budget have yet to really filter through.
“Working purely with today’s numbers things look pretty settled. Unemployment has held steady, wage growth has stayed firm and vacancy numbers have also remained pretty much where they were.
“But we can’t look at these numbers without considering the bigger picture. Business after business has said that they expect the increased labour costs will impact their decisions in the year ahead and with growth expectations considerably softened, the case for investment might be one being pushed into the long grass.
“Donald Trump’s chaotic implementation of tariffs has, in the words of Fed Chair Jerome Powell, ‘muddied the outlook’ for central bankers, governments and businesses alike.
“The Bank of England’s MPC is expected to walk the Fed’s path and hold rates where they are as they try and work out what the path of inflation might be and how domestic decisions already made, and those still to come in the Spring Statement, might further weaken the UK’s economic prospects.
“The government has been taking action on regulation, increasing spending on defence and trying to tackle the thorny issue of economic inactivity but all those things will take time to wash through.”
