The latest data from the Office for National Statistics (ONS) suggest that the UK labour market continues to cool; with many indicators showing signs of settling at a more sustainable level following the very robust performance seen over the last 18 months.
In particular employment fell and unemployment grew. Although some of the headline figures are disappointing, the increase in the number of full-time employees and strong earnings growth indicates that the underlying strength in the labour market remains resilient.
What does this mean for UK Economy?
In the coming months we expect to see employment growth resume, though at a more modest rate than over the last year (see our infographic for detailed figures). Growth in earnings is expected to remain healthy and household incomes will remain buoyant as the prolonged period of low inflation continues. Our forecast is for real household disposable incomes to grow by 3.4% in 2015, with consumer spending to grow by 2.6%.