U.K. August labour report gives mixed messages

U.K. headline ILO unemployment rate dropped to 5.4% in August, whereas total unemployment fell by 79k from July.

Unemployment in nearly all age groups was lower; the younger category (ages 16-24), reported its biggest decline since May 2014, falling by 40k, and the prime category (ages 25 to 49) continued to fall, but at a decreased pace, this time by 17k. 

However, the older category (aged 50 and over) continued to edge up, rising by 8k. Meanwhile, part-time jobs fell by 9k (after +88k in July) whereas full-time jobs were up by 36k over the month, leaving total employment higher by 27k after a 60k rise in July. In terms of the type of contract, self employed were lower (-16k) while employees were up (+58k). The August participation rate remained steady at 63.3%.

Earnings growth continued to climb higher as bonuses pickup. Average weekly earnings (AWE) grew by 3.0% 3m/y after 2.9% 3m/y in July, better than expectation, says Barclays. However, growth in core earnings was slower than expected at 2.8% 3m/y, slipping from its 2.9% 3m/y print in July.

Total AWE registered marginal increments in almost all sectors, while core wage growth reported a fairly broad-based decline across sectors; in particular, services, constituting 85% of total employment, declined from 3.0% 3m/y to 2.8% 3m/y.