UK unemployment rate drops again as firms hire more staff

UK unemployment fell for the fourth month in a row in April as businesses took on more staff in response to the relaxation of Covid-19 restrictions.

The Office for National Statistics said the jobs market showed further signs of recovery as non-essential shops and hospitality venues were allowed to open outdoors across the UK.

The unemployment rate fell to 4.7% in the three months to April, representing about 1.6 million people, in a modest improvement from 4.8% in the three months to March.

Businesses hired staff to cope with a rush of pent-up demand from lockdown-weary consumers, and the number of staff on company payrolls rose for a sixth consecutive month according to figures for May from HMRC, increasing by 197,000 to 28.5 million.

However, this remains 553,000 below levels recorded before the Covid-19 pandemic struck. Young adults, workers in hospitality and those living in London have borne the brunt of job losses in the past year.

The latest figures come after Rishi Sunak rejected business demands to extend the furlough scheme despite the four-week delay for the easing of Covid-19 restrictions previously set for 21 June. Business leaders and Labour have warned failure to provide fresh economic support would risk thousands of job losses this summer, as the furlough scheme is wound down from the start of July.

Sunak said the government’s plan for jobs was working. “We understand the value of work and the distress caused by unemployment – that is why we are continuing to support people and jobs,” he said.

“The furlough scheme is running all the way through until September and we are creating new routes into work through apprenticeships, Kickstart placements for young people as well as targeted support for the long term unemployed.”

The Bank of England expects the jobless rate to peak at almost 5.5% after furlough ends, compared with 4% – or about 1.3 million people – before the pandemic.

The figures fall a long way short of the initial fears, last year, that unemployment could reach 12% as a result of what was expected to be the worst recession in 300 years.


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