Introduction: UK jobless rate rises to 4.2% according to new experimental official data
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
The rate of UK unemployment rose 0.2% to 4.2% in the three months to the end of August, according to new data from the Office for National Statistics (ONS).
Over the same period the number of people in work fell by 0.3 percentage points to 75.7%, the Office for National Statistics said – the equivalent of 82,000 jobs. That follows a 113,000 drop in the previous quarter.
Vacancies fell below 1m to 988,000, a drop of 43,000 and the 15th consecutive quarterly fall, the ONS said.The ONS delayed the reporting of the figures by a week due to low response rates to its survey and the implementation of the new methodology.
Marcus Brookes, chief investment officer at Quilter Investors, said that the use of new data has led to a “slightly clouded” picture of the state of the labour market.
“Looking at the ‘experimental’ data, we can see that unemployment in the UK is remaining stable, for now. However, the fast rise in interest rates is beginning to bite and we are seeing companies scale back hiring and in some cases shed jobs, with the employment rate falling and unemployment rising gradually in the last three months. We know that economic growth in the UK is slowing and could potentially turn negative for the fourth quarter, so today’s data provides further evidence that things may be beginning to roll over.
However, Brookes added that the figures may provide “just enough” evidence for the Bank of England to continue to hold the UK base interest rate at 5.25% when its monetary policy committee next meets.
This health check on the UK jobs market comes as Barclays draws up fresh cost-cutting plans after reporting a 4% fall in profits in the third quarter.
Barclays, which saw profits fall from £1.9bn in the same quarter a year ago, said the dip was due to profits at its corporate investment bank tumbling 11%, despite the bank taking part in the $65bn (£53bn) stock market debut of Cambridge-based chip maker Arm in the US.
Also coming up today
Google parent Alphabet and Microsoft are set to report results in the US this evening.
The Agenda
9.30am BST: Manufacturing ‘flash’ PMI
11am BST: CBI Industrial Trends quarterly survey
Key events
Barclays in cost cutting drive after profits fall
Kalyeena Makortoff
Our banking correspondent Kalyeena Makortoff writes:
Barclays is drawing up fresh cost-cutting plans after a slowdown across its investment bank and concerns over a rise in customer defaults led to a slight drop in third-quarter profits.
The lender also saw growth in net interest income from its UK retail business stall, suggesting it was no longer benefiting from a gap between what it charges for mortgages and what it pays out to savers.
Barclays said its pre-tax profits fell 4% between July and September compared with a year earlier, to £1.9bn, roughly in line with analyst expectations.
Introduction: UK jobless rate rises to 4.2% according to new experimental official data
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
The rate of UK unemployment rose 0.2% to 4.2% in the three months to the end of August, according to new data from the Office for National Statistics (ONS).
Over the same period the number of people in work fell by 0.3 percentage points to 75.7%, the Office for National Statistics said – the equivalent of 82,000 jobs. That follows a 113,000 drop in the previous quarter.
Vacancies fell below 1m to 988,000, a drop of 43,000 and the 15th consecutive quarterly fall, the ONS said.The ONS delayed the reporting of the figures by a week due to low response rates to its survey and the implementation of the new methodology.
Marcus Brookes, chief investment officer at Quilter Investors, said that the use of new data has led to a “slightly clouded” picture of the state of the labour market.
“Looking at the ‘experimental’ data, we can see that unemployment in the UK is remaining stable, for now. However, the fast rise in interest rates is beginning to bite and we are seeing companies scale back hiring and in some cases shed jobs, with the employment rate falling and unemployment rising gradually in the last three months. We know that economic growth in the UK is slowing and could potentially turn negative for the fourth quarter, so today’s data provides further evidence that things may be beginning to roll over.
However, Brookes added that the figures may provide “just enough” evidence for the Bank of England to continue to hold the UK base interest rate at 5.25% when its monetary policy committee next meets.
This health check on the UK jobs market comes as Barclays draws up fresh cost-cutting plans after reporting a 4% fall in profits in the third quarter.
Barclays, which saw profits fall from £1.9bn in the same quarter a year ago, said the dip was due to profits at its corporate investment bank tumbling 11%, despite the bank taking part in the $65bn (£53bn) stock market debut of Cambridge-based chip maker Arm in the US.
Also coming up today
Google parent Alphabet and Microsoft are set to report results in the US this evening.
The Agenda
9.30am BST: Manufacturing ‘flash’ PMI
11am BST: CBI Industrial Trends quarterly survey
