UK Unemployment down

The UK’s unemployment has edged closer to the 7 % target stated by Bank of England governor Mark Carney which is thought to be the level at which the economy could successfully withstand an increase from the record low 0.5 % interest rate which was designed to ameliorate the effects of the recession and encourage borrowing, as the cost of borrowing is of course correlated  with the Bank of England base interest rate.

The unemployment rate has been validated by both the International Labour Organisation’s method of unemployment measurement and the claimant count method, both of which show a marked decrease in unemployment.

In response to the changes in unemployment, a surge of sterling purchases pushed the pound to a 7-month high against the Euro, as analysts still continue to predict a stronger economic regeneration than the Bank of England’s monetary policy committee ( MPC ).

There is still however a sizeable bank of information to suggest that conditions in the labour market remain precipitous for many, with wages rising at only 1.1 %- Significantly below the 2.8 % rate of inflation, which is still above the Bank of England’s 2.0 % target and which erodes the value of people’s wages, with the high inflation and meagre rise meaning that in real, that is to say inflation-adjusted terms , wages are actually lower this fiscal year than last. Furthermore, nearly a million people remain long term unemployed and youth unemployment has risen, again suggesting that the economy has a long way to go for long term, sustainable growth.