Unemployment rises sharply, exceeds forecast

The ONS reported that the unemployment rate increased to 4.3 per cent in the third quarter, up from 4 per cent in the three months ending in August.

• EasternEye
• 12 November, 2024

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By: EasternEye

UNEMPLOYMENT in the country has risen more than analysts anticipated, according to official data released Tuesday, with businesses signalling concerns over slowing job growth after the new Labour government raised business taxes in its latest budget.

The Office for National Statistics (ONS) reported that the unemployment rate increased to 4.3 per cent in the third quarter, up from 4 per cent in the three months ending in August. Analysts had predicted a smaller rise, expecting the rate to reach 4.1 per cent.

The ONS also noted that average regular wage growth slowed to 4.8 per cent, marking its lowest level in over two years as overall inflation returns to more typical levels.

This data follows the government’s recent increase in national insurance, a tax affecting companies, as part of its main budget at the end of October.

Isaac Stell, investment manager at Wealth Club, commented on the figures, noting that the higher-than-expected unemployment rate “serves as a warning sign to the government following on from the budget, where businesses saw a large increase in the level of national insurance contributions.” He added, “If these additional costs restrict hiring and cause jobs to be lost, its so-called growth agenda will be further scrutinised.”

In addition to raising taxes, Keir Starmer’s new administration has proposed increased borrowing, which it plans to invest in infrastructure projects aimed at stimulating economic growth in the UK.

(With inputs from AFP)