#news #economy #unemployment
In London, the labor market has shown further signs of slowdown in the early stages of 2025, as indicated by the Office for National Statistics. According to recent government data, the rate of wage growth has slightly decreased, while there has been a general increase in unemployment and a decline in job opportunities.
During the first quarter of 2025, the employment rate stood at 75%, which is slightly higher compared to the previous year. However, there has been a noticeable increase in the unemployment rate compared to the previous year.
From February to March, the number of employees listed on companies’ payroll decreased by 47,000, and there is an expected further decline of 33,000 in April. Additionally, there has been a slight decline in wage growth rates. The average weekly earnings, excluding bonuses, have increased by 5.6% compared to the same period last year, which is slightly lower than the 5.9% growth in the previous quarter. The total wage growth, including bonuses, has increased by 5.5%, while the real wage growth rate stands at 1.8%.
Furthermore, job opportunities have also decreased, with the total employment opportunities reaching 761,000, which is slightly lower than pre-pandemic levels.
Economic analysts attribute the slowdown in the labor market to the increase in high wages and the recent minimum wage growth. Particularly, sectors such as retail and hospitality have seen reductions in employment during March and April.
While there has been some decline in labor demand, the high wage growth rate poses a challenge for the Bank of England in managing inflation. The central bank has already reduced its main interest rate from 0.25% to 4.25% earlier this month. However, policymakers are cautious about further reducing interest rates until there is more evidence of declining inflation.
The National Statistics Office has acknowledged improvements in their labor force survey data collection method, but they also admit limitations due to lower participation rates compared to pre-pandemic levels.
According to analysts, the recent sluggishness in the labor market is not solely due to internal policy changes but also influenced by global economic uncertainties that have eroded business confidence worldwide.
Opinion from Ramesh Khatri, representative of Kansai Nepal News: “The current economic scenario in London reflects a challenging period for the labor market. It is crucial for policymakers to carefully monitor the situation and consider comprehensive strategies to address the issues of high wages and declining job opportunities.”
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Author: MAYA | HARUTO
Posted at: May 14, 2025 3:00 am
