Bill Robinson, Chief Economist at KPMG UK, comments on ONS monthly labour market statistics.
“Today’s labour market figures support the Bank of England’s findings last week that there is room for improvement before any increase in interest rates. The 0.2% fall in employment was weighted towards part time workers. Annual earnings growth has slowed to 1.9% in June, still above the 5-year average. With inflation at zero the real spending power of take home wages continues to rise, which is good news for employees and will continue to support growing consumption.
“The pace of wage growth, however, is unlikely to be inflationary considering the pause in employment growth. With the continued strength of sterling this makes any early move by the Bank of England to raise interest rates even less likely.”
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Ann Burton, KPMG Press Office
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KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 12,000 partners and staff. The UK firm recorded a turnover of £1.9 billion in the year ended September 2014. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 155 countries and has 162,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.
This article represents the views of the author only, and does not necessarily represent the views or professional advice of KPMG in the UK.