UK: Labor market recovers momentum - Lloyds

Analysts from Lloyds Bank point out that the biggest surprise relative to trends over recent months in the UK jobs report was the re-acceleration of employment growth, with the level as of the January-March 44k higher than 3 months ago.

Key Quotes:

“Today’s UK labour market figures for the 3 months to March saw some continuity with recent trends. The unemployment rate was unchanged at 5.1% for the fifth month in a row, as expected, holding around a level at which capacity constraints might be expected to put upward pressure on wages. Yet there is still scant sign of significant pay pressure.”

“The biggest surprise relative to trends over recent months was the re-acceleration of employment growth, with the level as of the January-March quarter 44k higher than 3 months ago.”

“The employment recovery in today’s data, and the extent to which it continues in future months, will be very relevant to the MPC’s assessment of the economy’s available spare capacity. By themselves, today’s data are moderately reassuring.”

“Pending the resolution of near-term uncertainties the MPC is likely to take limited steer from the data, in either direction.”