Financial News

  • 23 January 2014, 12:34

Unemployment Rate Falls To 7.1% In Job Surge

The UK unemployment rate fell to 7.1% during the three months to the end of November, prompting concerns of a rise in mortgage rates.

It was the biggest ever quarterly increase in employment. A total of 280,000 jobs were created in the period.

The Office for National Statistics (ONS) said the number of those jobless fell by 167,000 between September and November, to 2.32 million.

The ONS said a total of 30.15 million people are now in work. The number of people claiming jobseeker's allowance last month fell by 24,000 to 1.25 million, the ONS said.

It said average earnings increased by 0.9% in the year to November - excluding bonuses. The pay figure was unchanged on the previous month.

The drop in the unemployment rate has potential implications for both savers and borrowers.

The Bank of England's monetary policy committee said it would consider a base rate rise, from the current record low of 0.5%, when the unemployment rate reached 7%.

The 0.5% is the lowest sustained base rate since 1964.

Forecasters had not expected the threshold to be reached until later in the year.

The 7% jobless rate will not trigger an automatic rate rise, according to the bank.

The latest unemployment rate of 7.1% is down by 0.5% from June-August, and by 0.6% from a year earlier.

Youth unemployment also fell, by 1.0% on the quarter.

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