U.K. Unemployment Fells to Lowest in 2 1/2-Years

U.K. unemployment fell to the lowest in more than 2 1/2 years in October, as accelerating economic growth spurred companies to hire workers.

Claims for unemployment benefits dropped 9,900 from September to 824,000, the least since February 2005, the Office for National Statistics said today in London. The median forecast in a Bloomberg News survey of 29 economists was for a decline of 6,000. The jobless rate was unchanged at 2.6 percent.

Uninterrupted economic growth has almost halved the jobless register since the Labour Party came to power in 1997 and made Britain a magnet for foreign workers, who took 1.13 million of the 2.17 million jobs created over the past decade.

Jobless claims fell 13,900 in September, more than the 12,800 previously estimated.

Average earnings including bonuses rose an annual 4.1 percent in the three months through September, the highest since March and up from 3.7 percent in the period through August, the statistics office said today. Without bonuses, wage growth was unchanged at 3.7 percent.

Claimant unemployment has fallen for 13 consecutive months, the longest stretch of declines since the period June 2003 to January 2005, the statistics office said. Vacancies posted at job centers stood at a six-year high in October. Employment as measured by International Labour Organization standards rose 69,000 in the three months through September to 29.2 million.

There are some signs that the labor market is cooling. ILO unemployment rose 6,000 to 1.67 million, today's report showed. The jobless rate held at 5.4 percent.

Service industries from banks to airlines, the bulk of the economy, grew at the slowest pace in 4 1/2 years in October, a survey showed Nov. 5, while factory production dropped the most in seven months in September. An index of house prices fell to the lowest in more than two years in October, the Royal Institution of Chartered Surveyors said yesterday.

U.K. Unemployment Fells to Lowest in 2 1/2-Years

TradingEconomics.com, Bloomberg
11/14/2007 5:38:11 AM