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UK unemployment falls below 5%

813,000 jobs lost since the beginning of the pandemic

Britain’s unemployment rate dropped for the second consecutive month to 4.9% from December to February, a period in which most of the company remained locked down.

This is according to figures revealed by the ONS on Tuesday.

According to poll of economists by Reuters, the jobless rate was supposed to go up to 5.1% from 5% in the three months leading up to January.

The ONS linked the fall to a large volume of men leaving the jobs market altogether. The so-called inactivity rate rose by 0.2 percentage points in the three months to February, echoing a rise during the first lockdown of last year.

The number of employees on company payrolls dropped by 56,000 during the same period, the first decline in four months, a further reminder of the precarious state of the UK labour market.

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The total number of jobs lost since the beginning of the pandemic now stands at 813,000, over half of which were held by people aged below 25. The London hospitality industry was the most severely hit according to thee ONS.

Danni Hewson, AJ Bell financial analyst, commented on employment figures from the ONS:

“It might seem odd to be looking back when so much of the focus over the past couple of weeks has been on the future but it is important to understand the scale of the economic jolt the country has had,” Hewson said.

“Most of the data published by the ONS today is unsurprising but it does reinforce the huge challenges ahead. Whilst the unemployment rate fell a sliver for the three months to the end of February, early indicators suggest there was a further decrease in the number of employees on the payroll in March, down 56,000 from the previous month.”

“Once again the data confirms that it’s the under 25s bearing the brunt of lockdown restrictions – just over half of those falling off payrolls in the past year have been in this age bracket. But the playing field is levelling off; vacancies in sectors like hospitality were up in March as businesses geared up for lockdown release.”

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