-Aug Claimant Count Unemployment -15,000; rate 4.8%
-Jul Claimant Count Unemployment revised to -13,700 from -5,900
-Jul Average Weekly Earnings total pay +1.5% vs +1.8% in Jun
-May-Jul ILO Unemployment -7,000; Rate 8.1%

LONDON (MNI) – Claimant count unemployment fell sharply in August,
possibly helped by temporary hiring for the Olympics, but still showing
remarkable resilience in the face of stagnant growth, figures from
National Statistics revealed Wednesday.

The claimant count has now fallen by around 30,000 since the start
of the year, with most of that in the past two months. This strength in
the labour market has been puzzling economists and these data will add
further to the debate. It does seem likely, however, that the Olympics
has boosted short-term hiring over the past few months. But changes in
the benefit system have boosted the claimant count recently, meaning
that without these unemployment would have fallen even more.

The claimant count fell 15,000 between July and August, the largest
monthly drop since June 2010 and significantly below the median forecast
for unchanged. It followed a 13,600 decline in July, revised from an
originally estimated 5,900 decline.

London accounted for a significant part of the decline in the
latest month, with the claimant count down 5,500 in the capital. A
similar picture was seen last month, with the count down 4,500 in
London, and possibly points to Olympic hiring cutting the claimant count
temporarily.

Special factors also worked the other way, though, with cuts to
lone parent income support mean more women have applied for
Job Seekers Allowance in recent months. Latest data show this boosted
the claimant count by 6,950 in July which seems likely to have been
repeated in August.

The less timely, but official, ILO measure of unemployment fell
just 7,000 in May-Jul compared with Feb-Apr, with the unemployment rate
remaining steady at 8.1%. The ILO measure of unemployment lags the
claimant count and it seems likely that we will see increased falls
ahead.

Employment growth rose a massive 236,000 in the latest three month
period, the largest rise since the three months to July 2010. Much like
the claimant count figures, this seems out of place with the current
stagnant growth rate in the UK economy, adding further to the puzzle
surrounding labour market data.

Hiring from the Olympics may well have helped boost employment with
London adding 91,000 of the jobs in the latest three months. The rise in
employment across the UK was broadly evenly split between part-time and
full-time employment.

Earnings growth continued to remain subdued as it has done since
the start of the financial crisis. Headline Average Weekly Earnings
growth eased to 1.5% in the three months to July compared with a year
earlier, from 1.8% in June. This was in line with the median
forecast.

Regular average weekly earnings, which exclude bonus payments, rose
slightly to 1.9% from 1.8%, also in line with the median.

-London bureau: 00 44 207 862 7491 e:mail: puglow@marketnews.com

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