UK unemployment rate ticks lower in March despite lockdown
By Michele Maatouk
Date: Tuesday 18 May 2021
(Sharecast News) - The UK unemployment rate unexpectedly ticked lower in the first quarter despite the national lockdown, according to figures released by the Office for National Statistics on Tuesday.
The unemployment rate nudged down to 4.8% in the three months to March from 4.9% in February and versus expectations for it to be unchanged.
The ONS said the latest figures suggest the jobs market has been broadly stable in recent months, "with some early signs of recovery".
The number of payrolled workers rose by 97,000 in April, marking the fifth monthly increase in a row, but remains 772,000 below pre-pandemic levels. Since February 2020, the largest falls in payrolled employment have been in the hospitality sector, among those aged under 25 years, and those living in London.
The figures also showed that between February and April, there were an estimated 657,000 job vacancies, up 8% on the previous quarter, with most industries showing increases, namely accommodation and food services.
ONS director of economic statistics Darren Morgan said: "The number of employees on payroll rose strongly in April as the economy began to reopen, continuing the improvement from its November trough. There remains, however, three-quarters of a million people fewer on the payroll compared with the pre-pandemic peak.
"With many businesses reopening, the recent recovery in job vacancies continued into April, especially in sectors such as hospitality and entertainment.
"The renewed lockdown at the beginning of 2021 saw a sharp rise in the number of previously unemployed people no longer looking for work, helping the unemployment rate to fall on the quarter. This mirrored what happened during the first lockdown."
Capital Economics said the slight fall in the unemployment rate suggests that the government's job furlough scheme is still insulating the labour market from the worst effects of the pandemic.
"And the improving outlook for activity suggests that our forecast that the unemployment rate will rise to a peak of 6.0% by early 2022 may be too pessimistic," said UK economist Thomas Pugh.
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