Unemployment in Wales: Slight rise to 3.1%

  • Unemployment in Wales: Slight rise to 3.1%

Unemployment in Wales: Slight rise to 3.1%

The 104,000 rise in the number of people unemployed during the three-month period to July took the total to 1.4 million, and raised the unemployment rate by 0.2 percentage points to 4.1% - the biggest increase since the pandemic began. The number of people claiming for jobless benefits has risen to 2.7 million, an increase of 121 per cent since March.

"However, the decline in employees on payrolls and the rise in the claimant count in August as the furlough scheme began to taper is a clear warning that the full impact of coronavirus on the United Kingdom labour market is yet to come".

The UK's average weekly Earnings, excluding bonuses, arrived at +0.2% 3Mo/YoY in July versus -0.2% last and -0.2% expected while the gauge including bonuses came in at -1.0% 3Mo/YoY in July versus -1.2% previous and -1.3% expected.

Over the quarter, there has been a large decrease in the number of young people in employment.

It is a relief that unemployment has increased at a slower rate in Wales than the United Kingdom as a whole.

Reuters quoted an economist Samuel Tombs, with Pantheon Macroeconomics, who said job losses were likely to accelerate in September and October when employers will have to pay more towards the cost of the furlough scheme because "The number of people searching on Google for phrases including "redundancy" rocketed to a record high in July, consistent on past form with the official measure of redundancies peaking in September".

Matthew Percival, Confederation of British Industry director of people and skills, said: "The easing of lockdown restrictions and a more flexible Job Retention Scheme in July have led to the beginning of a recovery in vacancies and hours worked".

The claimant count reached 2.7 million in August 2020, an increase of 120.8% since March 2020. Employment fell by 102,000 in July alone, the first decline since April. Generally speaking, the positive earnings growth anticipates positive (or bullish) for the GBP, whereas a low reading is seen as negative (or bearish).