The labour market statistics for December 2017 to February 2018, indicate that the economy is gradually returning to a healthy state, with a marked increase in the number of full-time and part-time workers.

The latest labour market statistics continue to indicate that the economy is gradually returning to a healthy state. Average weekly earnings rose by 2.8% in the year to February (on the preferred total pay, 3 month measure), slightly ahead of the CPI inflation rate of 2.7%. Real wages are therefore increasing now, albeit at an agonisingly slow rate. The (less reliable) single month measure of total pay has slowed to 2.3% (from 2.8% a month ago), so whether the new data truly herald the end of the pay squeeze still remains to be seen.

On employment, the news is good. The three months to February saw an increase of 67,000 in full-time employees and 36000 in part-time employees. Meanwhile the numbers in self-employment fell somewhat (15,000 fewer in full-time, and 3,000 fewer in part-time self-employment). These trends seem to confirm that the labour market is gradually returning to a more stable state following a period in which many workers took on gig employment as a stop-gap in the aftermath of the recession.

About the author

Geraint Johnes

Professor of Economics, Lancaster University Management School