UK unemployment hits 7 year low

UK unemployment has fallen to its lowest level since 2008.

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By :  ,  Financial Analyst

The jobless rate in the UK continues to improve as unemployment drops to a seven-year low.

Figures released by the Office for National Statistics (ONS), revealed that the number of people out of work fell by 76,000 to 1.84 million in the three months to February. It means that unemployment has fallen to a rate of 5.6 per cent, the lowest level since July 2008 and remains in line with forecasts.

The announcement comes as a report from EY Item Club revealed that the UK's economy is set to grow in the coming year. It stated that the nation's economy will expand by 2.8 per cent in the next 12 months and has been boosted by low inflation, tumbling oil prices and a much stronger performance from the eurozone.

Despite unemployment falling, the ONS noted that average weekly earnings remained sluggish. In the three months to February, weekly earnings, excluding bonuses, rose by 1.8 per cent compared to the same period a year earlier. When bonuses are included wages grew by 1.7 per cent.

Chancellor George Osborne hailed the figures. Speaking ahead of the International Monetary Fund's (IMF) spring meeting, Mr Osborne said: "Those forecasts have been more than reinforced by the employment figures we saw this morning, which show a record number of people in work.

"They show the claimant count at its lowest level since 1975 and they confirm that under this government two million jobs have been created. So the British economy is a job-creating machine."

Record low inflation

The ONS confirmed last week (April 15th) that inflation in the UK would remain at its record low of zero per cent. It is the second consecutive month where this has been the case and was a result of cheaper clothing and footwear, offset by a rise in petrol prices.

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