British companies continued hiring hundreds of thousands of new employees in the November to January period, even with Brexit right around the corner.
New data from the UK’s Office for National Statistics (ONS) showed employers ramped up their hiring at the fastest pace in more than three years during the three-month period spanning 2018 and 2019.
The number of people in work surged by 222,000, pushing the unemployment rate down to 3.9%, its lowest level since 1975. The sharp increase in new jobs handily beat economists’ expectations.
The tight labour market has supported wage growth as companies try to retain their workers, while also recruiting new hires.
Average weekly earnings were up 3.4% in the three-month period compared to the same time last year, according to the ONS. Once you factor in inflation — which eats into people’s earnings — workers were making about 1.5% more compared to last year.
The labour market has continued to defy weakness in the overall economy. Businesses have kept hiring even as they warned that uncertainty has led them to pause investments and struggle with planning for the future.
“It appears that the labour market is still in remarkably rude health despite the ongoing calamity surrounding Brexit,” said David Cheetham, chief market analyst at the trading platform XTB.
The latest pay data is considered to be a positive sign for workers across the country.
“Political developments aside, these latest numbers, combined with the moderation in inflation … suggests that 2019 is among the better recent periods for workers,” according to Mike Jakeman, a senior economist at PwC. “Upward pressure on wages is likely to continue for the remainder of the year at least, on the assumption that a no-deal Brexit is avoided.”
The ONS labour market report was accidentally released 10 minutes early, at 9:20am UK time instead of the scheduled 9:30am.
A spokesperson told Yahoo Finance UK the early publication was due to an “error” and an “oversight on our part.”
While this report is known to influence market sentiment, there was little reaction in stocks and currencies (GBPUSD=X) on Tuesday.
“Despite a robust set of figures … all eyes are still firmly on Brexit proceedings and the pound’s muted reaction reflects this,” said Hamish Muress, a currency analyst at the international payment platform OFX.