A SENIOR statistician has said the labour market “appears to be edging towards full capacity”.

David Freeman, a statistician at the ONS, was highlighting how employment has risen.

The employment rate rose to 74.6 per cent in the final three months of last year, the highest rate recorded since data started being collected in 1971.

However it’s not all good news. New figures show wage growth has slowed. Average earnings are 2.6 per cent higher during the fourth quarter compared with the same time a year earlier.

One of the reasons for increased employment is more women entering the work place. Male employment rates are actually low but the proportion of women in work stands at 70 per cent. The unemployment rate remained at 4.8 per cent, the lowest level since 2005.

The increase in employment was also accounted for by a 45,000 rise in the number of people employed fulltime, while the number of people working part-time fell by 7,000.

Not all regions fared equally in employment however. Employment hit a record high in London, the southeast and Northern Ireland but in the past year the employment
rate has fallen other areas – such as in Scotland, the north-east, northwest and the east of England.

While wages usually grow with employment, this wasn’t the case. The annual growth in average earnings during the fourth quarter to the end of December was at 2.6 per cent. Inflation also picked up, meaning earnings rose by just 1.4 per cent after inflation. This was the lowest growth for two years.

It was forecast by Bank of England’s agents in surveys that the slowdown will continue in 2017. Employers predict average pay settlements of 2.2 per cent this year, down from 2.7 percent in 2016.