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Unemployment at its lower for nearly 10 years
Official figures from the Office of National Statistics (ONS) indicate that the UK unemployment rate is at its lowest level (5.2%) in nearly 10 years.
The number of people out of work fell by 110,000 to 1.71 million between August and October and there were 31.3 million people in work, 505,000 more than a year earlier.
“The employment rate is at its highest ever level, the unemployment rate is down to its lowest since well before the crash at 5.2%, and youth unemployment – always a tricky problem to solve – continues to fall impressively,” said Michael Martins, economic analyst at the Institute of Directors. “All of this indicates we are closing in on full employment.”
Vacancies of 747,000 in the UK jobs market have not been higher since data began in 2001, and the number of hours worked per week topped one billion for the first time, the ONS said. This was a consequence of more people in work, “as average weekly hours per person are fairly stable,” said Mr Freeman of the ONS.
Earnings continue to grow in real terms although workers pay growing at a slower rate
Whilst unemployment is falling, the pay of workers grew at its slowest rate since the January to March period. Total pay grew 2.4%.
“Earnings continue to grow in real terms, although at a slower rate than we have seen in recent months,” ONS statistician David Freeman said.
Bank of England Governor Mark Carney has said he would like to see earnings growth above 3% a year before he would increase interest rates.
“What this means for wages and inflation over the next 12 months, however, is less clear. In theory, a tightening labour market should mean wage rises. This is the trend we saw throughout 2015. But wage growth has outpaced productivity for much of this year, and in the last few months pay increases have trailed off.”
BCL Legal – opinion
The findings of the ONS make for interesting reading and very much echo the experience of BCL Legal in 2015. We have seen increasing amounts of employers come to us with legal vacancies and indeed more and more lawyers (candidates/employees) securing pay increases, particularly when made an offer elsewhere. For employers, retaining talent is as important, if not more so than attracting talent.
Alongside the lower inflation rate, real earnings are on the increase – perhaps due to lower fuel costs and the supermarket price wars. Within the legal profession, many of our commercial legal clients now feel more secure, better looked after and with greater prospects than they had last year. Quality talent is in demand and wage increases are taking place to retain and to attract talent.
There are some negative signs in the wider economy, and politically, however at this time the general consensus is that the legal profession is performing well and that quality legal talent can take advantage – either through career progression or employer moves. This is particularly the case for commercial contracts lawyers, corporate lawyers, commercial property lawyers, construction lawyers and compliance/regulatory/finance lawyers, who are in demand by both private practice and in-house legal teams.
We expect the beginning of 2016 to be buoyant however mid-late 2016 is very much an unknown. Taking advantage of the situation now is definitely the best advice we can give.
The original BBC article can be found here: http://www.bbc.co.uk/news/business-35111020
The ONS website can be found here: http://www.ons.gov.uk/ons/index.html