The unemployment rate in Britain unexpectedly decreased for the second month in a row to 4.9% in the period from December to February, which the United Kingdom spent most of it in strict lockdown due to the spread of the Coronavirus. Market expectations indicated a rise of 5.1%.
Data from the British Tax Office showed the precarious state of the labor market, as the number of employees on company payrolls decreased by 56K between February and March, the first drop in 4 months, and this raised the total number of jobs lost since the outbreak of the pandemic to 813K.
The British economy shrank by roughly 10% in 2020, a slowdown greater than nearly all of its European peers, having shut down later and longer than many of them.
The Office for National Statistics said there was a noticeable rise in vacancies in March, particularly in sectors like hospitality that reopened for outdoor work last week.
Finance Minister Rishi Sunak in March extended the leave scheme - which pays around one in five employees - until the end of September although employers will start contributing some of its costs from July. Without the program, the unemployment rate would be much higher - a year ago, UK budget experts said it could reach 10%.
Bank of England will monitor the number of jobs lost as it considers how long it needs to maintain its massive economic stimulus program.
The main measure of wage growth in Britain rose strongly again in the three months to February, up 4.5% on yearly basis. But the Office for National Statistics said the reading was skewed higher due to the decrease in the number of low-wage and part-time jobs. With that in mind, wage growth was much weaker at 2.5%, according to estimates.