UK: Continued tightening in the labour market - TDS

Analysts at TD Securities explain that the UK’s August employment report showed signs of continued tightening in the labour market, with ex-bonus wage growth rising above expectations to a 9-year record of 3.1% 3m/y while the unemployment rate remained unchanged at 4.0%.

Key Quotes

“Furthermore, core private sector regular pay growth picked up to 3.3% 3m/y, while employment growth fell into negative territory (-5k), providing increasing evidence that firms are finding it difficult to hire the workers they need, and suggests that wage pressure could be sustained going forward. This should provide reassurance to the BoE that the economy continues to operate at (or possibly even slightly above) its potential.”