Will the Latest Delay in Brexit Impact Britain’s Employment Rate?
According to a survey by CIPD, hiring plans among British employers have received a boost, picking up from the lowest levels in 18 months during Q3 2019. The CIPD’s quarterly net employment balance climbed to +22 in Q3 from +18 in the previous quarter. This has been the average level for this index in 2018 as well.
Record low unemployment levels have so far supported the British economy even as Brexit uncertainties and other external risks have kept economic growth under pressure since the 2016 referendum. Wage growth has also remained strong, suggesting signs of a healthy labor market overall, despite rising political uncertainties.
However, according to government data, there has been a decline in the number of employed people. A recent Reuters poll too anticipates employment rate to experience a steep decline in Q3 2019 – a sentiment echoed by some BOE officials as well.
The upcoming general elections and the delay in Brexit have upped the risks for the labor market as well. As Brexit drags on, business confidence among British companies could be affected further, forcing them to put off plans for hiring and increasing wages in times of heightened economic uncertainties.
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