Britain’s rising unemployment rate muddles PM Sunak’s message to voters | World News

Britain’s jobs market showed more signs of cooling in April as the unemployment rate rose, a tricky development for Prime Minister Rishi Sunak ahead of the July 4 election, despite another month of strong wage growth .

Official data released on Tuesday showed the unemployment rate for the three months through April rose from 4.3 percent between January and March to 4.4 percent, the highest figure for the three months through in September 2021, the Office for National Statistics said.

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A Reuters poll of economists forecast an unchanged unemployment rate.

“This month’s figures continue to show signs of a possible cooling of the labor market, with a continued decline in the number of job vacancies and a rise in unemployment, although income growth remains relatively strong,” said l ‘ONS.

The number of people employed has fallen by 207,000 since the end of 2023, while unemployment has increased by 190,000, the data shows.

The opposition Labor Party is on course to win the July 4 national election, according to opinion polls which give Keir Starmer’s party a lead of around 20 points over the ruling Conservative Party.

Sunak, whose pitch to voters hinges on the idea that the economy is improving under his leadership, can at least point to a big rise in wages, taking into account inflation.

Average weekly earnings excluding bonuses, and adjusted for the consumer price index, rose 2.3 percent in the three months to April compared with a year ago – the highest figure for almost of three years.

Britain’s inactivity rate – measuring people out of work and not looking for work – reached 22.3 percent, its highest level since mid-2015, highlighting what the Bank of England considered a source of inflation in the labor market.

According to media reports, Sunak is expected to announce later on Tuesday that he would cut social security contributions by a further two percentage points if his Conservative party defies opinion polls and wins the election.

Cuts in social security contributions are seen as a way to encourage more people to enter the job market, although two recent two-point cuts have failed to stem the rise in inactivity.

Data on wage growth, a key indicator of inflationary pressure for the BoE which is due to make its next policy announcement on June 20, remained hot.

The nominal average weekly wage excluding bonuses increased by 6.0 percent in the three months to the end of April compared to the same period a year earlier.

Economists polled by Reuters forecast wage growth of 6.1 percent.