Record 32m people in work, but wages failing to keep pace with inflation

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Employment has reached a record high but pay continues to fall behind inflation, new figures show.

Almost 32 million people are in work - 372,000 more than a year ago and the highest total since records began in 1971.

Unemployment fell by 50,000 in the quarter to April to 1.53 million, the lowest for more than a decade.

The number of people classed as economically inactive fell by 30,000 to 8.8 million, a rate of 21.5%, the joint lowest on record.

But the Office for National Statistics (ONS) also reported a fall in average earnings, which grew by 2.1% in the year to April, down by 0.2% on the previous month.

The fall was greater when measured over a three-month period, confirming that wages are falling behind the 2.9% inflation rate.

Matt Hughes, senior statistician at the ONS, said: "Many labour market indicators remain strong, with the employment rate at a joint record high and the inactivity rate at a joint record low.

"On the other hand, with wage growth continuing to slow and inflation still rising, real pay is down on the year. This is now the case whether or not bonuses are taken into account."

Other data showed a continued rise in the number of people on the so-called claimant count - up for the third month in a row in May to stand at 802,600.

The number of workers in the public sector has fallen by 20,000 over the past year to 5.4 million.

Of all people in work, 17% were employed in the public sector, the lowest figure since records began in 1999.

Local government employment has fallen to a record low of 2.1 million, while jobs in private firms increased by 115,000 over the past quarter to 26.5 million, the highest on record.

There are now around one million fewer employees in the public sector compared with the peak of 6.4 million in 2009.

There were 770,000 job vacancies in the quarter to May, 9,000 more than the previous three months and close to a record high.

New Work and Pensions Secretary David Gauke said: "This Government wants to give everyone the opportunity to succeed, regardless of where they live or their background.

"This is yet another strong set of record-breaking figures, with employment up and unemployment down, fuelled by full-time opportunities.

"This is good news for families as we continue to build a stronger, fairer Britain."

He highlighted other figures showing that the female employment rate is at a joint record high of 70.2%, with nearly 15 million women in work.

The unemployment rate for 18 to 24-year-olds who have left full-time education is 10.7% - a joint record low.

TUC general secretary Frances O'Grady said: "Real wages have fallen for the second month in a row. Unless the Government gets its act together, we'll soon be in the middle of another cost of living crisis."