UK unemployment rate steady, wage growth remains high

(Sharecast News) - The UK unemployment rate was steady in February, while wage growth remained high, according to figures released on Tuesday by the Office for National Statistics. The unemployment rate was unchanged at 4.4% in the three months to February.

The figures also showed that growth in annual average weekly earnings excluding bonuses was 5.9%, slightly lower than consensus expectations for 6% growth. Growth in average earnings including bonuses was 5.6%, in line with expectations.

Liz McKeown, director of economic statistics at the ONS, said: "Regular pay growth remains strong having increased slightly in the latest period.

"Growth accelerated in the previous pay rises fully fed through to our headline figures, while pay in the private sector was little changed.

"The latest survey results estimate that the unemployment rate is unchanged on the previous three months, while separately the number of employees on payroll fell slightly over the same period."

Ashley Webb, UK economist at Capital Economics, said: "Overall, while wage growth remains too high, the growing downside risks to inflation and activity from higher US tariffs may mean the Bank of England starts to become less worried about the upside risks to inflation from pay growth and more worried about the downside risks to activity.

"The risk is that interest rates are cut a bit faster than the fall from 4.50% now to 4.00% this year that we expect."