Unemployment falls to 7.1 per cent

The UK unemployment rate has dropped to 7.1 per cent, according to the latest figures from the Office for National Statistics (ONS).

The ONS data shows the number of people out of work fell by 167,000 to 2.32 million in the three months to November 2013.

The fall means the unemployment rate is almost at the seven per cent figure at which the Bank of England has said it will consider raising interest rates.

Key ONS figures for the period September-November 2013:

  • The number of people in employment reached 30.15 million, increasing by 280,000 compared to June to August 2013
  • 72.1 per cent of people aged 16 to 64 were employed, up 0.5 percentage points from the previous quarter
  • Total and regular pay both grew by 0.9 per cent compared to the same period in 2012.

John Allan, chairman of the Federation of Small Businesses, welcomed the figures but cautioned against raising interest rates:

"Another set of positive unemployment figures reflect what our members tell us about their recruitment intentions. While weak pay growth remains a concern, we are hopefully turning a corner with seven in 10 small firms intending to increase staff pay in the next 12 months.

"Despite improvements in the labour market, we would like to see a prolonged period of business confidence before the Bank of England's forward guidance comes into effect and increases interest rates."