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Unemployment falls by 125,000

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The job market will be characterised by higher wages and increased movement in the future, Reed group managing director Tom Lovell has suggested.

His comments followed the publication of labour market statistics that showed the number of people out of work in the three months to December fell by 125,000 to 2.34 million.
 
The results from the Office of National Statistics (ONS) showed the unemployment rate now stands at 7.2%, and wages increased by 1.1% in the year to December.
 
ONS senior labour market statistician Nick Palmer issued a warning alongside the results. He said the main conclusion to be drawn from the figures was “that the rate at which unemployment has been falling is likely to have slowed down."?

Lovell said increased productivity within businesses would provoke a slower rate of unemployment.
 
“It’s been widely reported that the reduction of joblessness has slowed. I think that will continue, but it will be replaced with improvement in productivity,” he said.
 
“We’ve seen some slight increase in pay and this will encourage people to move jobs.
 
“Over the forthcoming months we’d expect to see a continued shift in businesses towards productivity, which will continue the upward pressure on pay.”
 
The figures also revealed a fall in the number 16 to 24-year-olds out of work to 917,000, down 48,000 from July to September 2013.
 
Lovell said this was a sign of good confidence among employers. “People are willing to take young people on and train them,” he said.

However, the Work Foundation senior economist Charles Levy pointed out that unemployment increased slightly among 16 and 17-year-olds, "emphasising wider unanswered structural problems".

"Underemployment remains a problem with 1.4 million individuals working part-time," he added. "The jump in self-employment is also of concern since self-employment is dominated by low-wage work.  If our recovery is to be sustained, the attention must now shift onto supporting those on the edge of our labour market.”