MNI BRIEF: Resilient UK Labour Market Beats BOE Expectation
Although slowing, the UK labour market still stronger than forecast by Bank of England
Employment growth in the UK has slowed in recent months, the Office for National Statistics said Tuesday, but overall, the labour market remains stronger than forecast by the Bank of England.
The data follows the release of the rejigged Labour Force Survey publsihed last week, and confirms the jobs market could be tighter than previously assumed and with unemployment still below 4% and wage growth decelerating at a slower pace than expected. “It is clear that growth in employment has slowed over the past year. Over the same period the proportion of people neither working nor looking for work has risen, with historically high numbers of people saying they are long-term sick," ONS director of economic statistics Liz McKeown said.
The Bank of England will get another job market report and two more sets of inflation data before the March policy meeting. Although no cut is expected until later in H1 at the earliest, continued relative strength in the labour market could push the first cut back further. MPC member SwatI Dhingra will likley address these issues at an upcoming MNI event (see MNI INVITE: Livestreamed MNI Connect VC with BoE Dhingra On Feb 21)