Economy ‘firing on all cylinders’ - Clegg claims
- Published on Wednesday, 14 May 2014 12:14
- Written by Daniel Mason
The British economy is starting to "fire on all cylinders", deputy prime minister Nick Clegg claimed today, following the publication of data showing unemployment at a five-year low.
According to the Office for National Statistics, the jobless rate in the three months to March was 6.8% - with the number of people out of work falling by 133,000 to 2.2 million. The number employed rose to 30.43 million, the highest since records began in 1971, while self-employment reached a record high of more than 4.5 million.
In addition average earnings, including bonuses, were 1.7% higher than a year earlier - meaning wage growth outstripped inflation for the first time since 2010. However, excluding bonuses, wage growth was just 1.3%, lower than inflation at 1.6%.
In a statement welcoming the figures, Clegg said: "We are starting to see the British economy firing on all cylinders and this means more people are in work today than ever before. We have fewer unemployed people, falling long-term unemployment and the highest ever female employment rate.
"The coalition government is not just focused on balancing the books, but also on creating more jobs and growth outside of London and building a fairer society for this generation and the next."
The prime minister, David Cameron, tweeted: "There's more to do, but it's welcome unemployment is down again. More jobs means more financial security for people."
For Labour, shadow work and pensions secretary Rachel Reeves said the fall in unemployment was "welcome" but added that there was "a huge amount of lost ground to catch up" on wage growth.
"Working people are now over £1,600 a year worse off than when David Cameron came to office and the link between the wealth of the nation and family finances remains broken," she said.
"While the top 1% have seen their share of national income rise over the last year, the bottom 90% have seen theirs fall. It's totally out of touch for the Tories to try and claim the cost-of-living crisis faced by hardworking Britain is suddenly over."
The general secretary of the TUC, Frances O'Grady, warned that the rise in self-employment did not mean the UK was becoming a "nation of budding entrepreneurs". "Your are far more likely to be a self-employed hairdresser, care home worker or Ebay seller than run your own business and take on staff.
"It is a real concern that rising employment is failing to boost pay, which is barely growing in real terms. This should serve as a reminder to the Bank of England that this is not a full-blown recovery, and that an early rise in interest rates could choke off growth."
But the CBI's director for employment and skills, Neil Carberry, argued that the "flexible jobs markets" was continuing to deliver. "There is more to do but the signs are encouraging and we expect real wages to rise in the year ahead as productivity picks up," he said.
David Kern, chief economist at the British Chambers of Commerce, added: "The figures continue to demonstrate the flexibility and resilience of the jobs market was continuing to strengthen."