LONDON, Aug 18 (Reuters) – Britain’s labour market cooled somewhat in the second quarter, which was marked by slowing earnings growth in the private sector and the smallest number of vacancies in more than five years, official data showed on Tuesday.
Private sector regular earnings — watched by the BoE as a gauge of domestic inflation pressure — rose by 2.8% in the annual terms during the three months to June, marking the weakest growth since the three months to October 2020.
While that matched the BoE’s own forecast published last month, sterling fell slightly on the data, which also showed the unemployment rate holding at 4.9%, against expectations in a Reuters poll of economists for a drop to 4.8%.
The number of open job vacancies fell to 707,000 in the three months to July, down from 711,000 in the three months to July, the Office for National Statistics said. It was the smallest total since the three months to April 2021. Excluding the pandemic, vacancies are at their lowest since late 2014.
“The labour market picture is little changed overall, with some softening still evident,” ONS Director of Economic Statistics Liz McKeown said.
Overall annual earnings growth, excluding bonuses, was 3.5% in the second quarter, the Office for National Statistics said on Tuesday.
Economists polled by Reuters had mostly expected regular wage growth of 3.4%.
The BoE is closely watching whether the energy price jump caused by the Iran war is turning into longer-term inflation pressures in the economy.
Financial markets on Monday showed one 0.25 percentage-point interest rate hike priced by the end of 2026.
(Reporting by Andy Bruce and David Milliken; editing by William James)
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