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The UK unemployment rate fell to an eight-month low in April as pubs and restaurants reopened

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The UK economy is gradually reopening from coronavirus lockdowns.

  • The UK unemployment rate fell to an eight-month low in April as pubs and restaurants reopened.
  • Pay also picked up sharply, rising 5.6% on average in the three months to April.
  • The Bank of England expects UK unemployment to peak just below 5.5% in 2021.
  • See more stories on Insider’s business page.

The UK unemployment rate fell to an eight-month low of 4.7% in the three months to April, official figures showed on Tuesday, as the reopening of key parts of the economy boosted the jobs market.

April’s figure was below the 5% unemployment rate seen in the previous quarter and was the lowest figure since the three months to August 2020.

Separate data from the ONS showed that the number of employees on payrolls surged in May by 197,000, the most on record.

The labor market recovery was seen in pay packets too, with Britons’ average total pay for the three months to April jumping 5.6%. However, economists said the figure was flattered by last year’s low base.

“Our plan for jobs is working,” said UK Chancellor Rishi Sunak. “The latest forecasts for unemployment are around half of what was previously feared, and the number of employees on payroll is at its highest level since April last year.”

Britain’s rollout of coronavirus vaccines has been one of the quickest in the world. It allowed the government to start easing restrictions meaningfully in April, when non-essential stores reopened, and pubs and restaurants began to serve people outside.

The UK government’s job-retention scheme – widely known as “furlough” – has also kept a lid on unemployment by paying the wages of workers who might otherwise have lost their jobs.

UK unemployment peaked at 5.1% in the three months to December, compared with a 14.8% peak in the US in April 2020.

The Bank of England said in May it expects UK unemployment to pick up again slightly and peak just below 5.5% in the third quarter of 2021, when the furlough scheme winds down further.

Yet the reopening of Britain’s economy has not been completely smooth. Prime Minister Boris Johnson on Monday evening said his government would have to delay the next stage, due to a surge in cases of the Delta coronavirus variant, which was first found in India.

The pound edged up after the data, to trade 0.1% higher against the dollar at $1.412, close to session highs.

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