Young people and part-time workers hit by fall in UK employment –business live

Number of people in work across Britain has fallen by the most since 2015

• Latest: Young people and part-time workers hit
• UK employment down by 58,000 in last quarter
• Biggest drop in employment since 2015
• The key charts
• Wage growth slows to 3.6%

2.02pm GMT

Time for a recap, from our economics editor Larry Elliott, on today's jobs data:

Employment in the UK has fallen at its fastest rate in four years amid growing evidence that a slowing economy is taking its toll on the labour market.

Figures from the Office for National Statistics showed that pay growth had fallen back in the three months to September, leading to speculation that the jobs market is past its peak.

Related: UK employment takes biggest tumble in four years

1.58pm GMT

Professor Costas Milas Liverpool University has also crunched today's data, and reckons that the unemployment rate (now just 3.8%) probably won't fall any further.

He explains:

I have plotted a measure of the UK output gap (UK GDP relative to 'trend output; the latter based on the average of three standard trend measures: quadratic trend, Hodrick-Prescott trend and Christiano-Fitzgerald trend) together with the UK unemployment rate and annual changes in the UK unemployment rate.

As the economy expands, unemployment drops. It now appears that the economy has settled to around 0.9% below par which means that a further drop in the unemployment rate (from its current values 3.8%-3.9%) does not look likely.

This looks unlikely in the current climate of Brexit-related uncertainty. Unless, of course, the BoE cuts the policy rate".Which, MPC might want to do because, as the plot shows, the very fact that output is below equilibrium implies a low risk of inflation!

1.22pm GMT

Back in the markets, eurozone stocks are still higher today as investors await Donald Trump's speech at the New York economic club at 5pm UK time.

Ben White of Politico has heard that the president will make encouraging noises about a trade deal with China. He writes:

There will be plenty of cheerleading about the low jobless rate, wage growth, stock market gains and the extension of the longest economic recovery in history. Perhaps even some stuff about the "greatest economy ever."

But the most interesting section will be on China. Investors around the world will be looking for signals about whether a "Phase One" deal where tariffs on both sides are reduced and the further levies on consumer goods imported from China expected to go into effect in December disappear, at least for now. MM is told by a source familiar with Trump's remarks that there will a "constructive statement on China."

US Opening Calls:#DOW 27709 +0.07%#SPX 3089 +0.06%#NASDAQ 8248 +0.07%#RUSSELL 1597 +0.15%#FANG 2825 +0.18%#IGOpeningCall

1.13pm GMT

Here's a handy thread on today's jobs data, from Chris Giles of the Financial Times:

Short thread on the state of the UK labour market

tl:dr
- Job numbers strong, but no longer improving
- Pay growth better but also signs of a turn down

1/

Whatever your economic views, the strength of employment has surprised (I think) everyone over the past decade

And unemployment fallen further although it has now flatlined for a while

2/ pic.twitter.com/4xkFkVf3Kr

There has definitively been a big rise in people willing to work, often for rather poor pay.

Especially parents.

The stay-at-home-parent is now a disappearing breed@resfoundation today say (convincingly) this is a reflection of a "feel poor, work more" effect pic.twitter.com/7akiJ1TOTv

Pay levels have not recovered back to the 2008 level after taking account of inflation.

Cannot repeat often enough that this is EXTRAORDINARY

So UK economy growth has come from more people working rather than normal improvements in efficiency

4/ pic.twitter.com/zkjDqy2hPg

Pay growth has recently recovered to more normal levels, but the latest data suggest it is struggling to stay up at the 4% nominal mark

5/ pic.twitter.com/PXO9dyqnfu

This might suggest more slack in the labour market again.

Or, that productivity growth is so terrible that employers cannot easily afford to offer real pay rises

Look at the awful productivity numbers and you cannot dismiss the latter point

Output per worker < end 2017

6/ pic.twitter.com/eaZ6C2rYXW

So, some sings of cooling in demand...

... but also signs of a plateau with poor productivity growth

Probably a bit of both...

It's doesn't feel like there is much scope for a sudden rebound though

ENDS/

1.02pm GMT

The drop in part-time workers, and in younger workers, is a worrying sign, according to the Resolution Foundation:

Their economic analyst Nye Cominetti explains why it could herald a downturn:

"Until now the jobs market has seemed immune to wider economic conditions, and the uncertainty that is dragging on UK growth. But falling employment, fewer vacancies and slowing pay growth suggest this may no longer be the case.

"The recent drop in female employment and slight uptick in youth unemployment are worrying symptoms, as these groups are often first to feel the effects of falling employment.

1.00pm GMT

Today's labour market stats: regional employment rate changes: Scotland and Wales particularly down. @LearnWorkUK briefing https://t.co/etKKtlCI0f pic.twitter.com/9bSvBcNQJg

12.37pm GMT

Over in Germany, economic confidence has bounced back from its recent slump - an encouraging signal.

The ZEW Institute's sentiment index has come in at -1, up from -23.5 in October. Although still in negative territory, it suggests investors are less gloomy.

"Hope is growing that the political and economic environment will improve in the near future."

Finally some good news from Germany as the ZEW economic sentiment index jumped in November. However, economists' expectations say little about actual GDP-growth. The more relevant "current conditions" increased only marginally, but at least it did not drop further #macrobond pic.twitter.com/5B3EUGMwEn

11.59am GMT

UK jobs reaction summary: generally negative
'No sharp downturn'
'showing more signs of strain'
'labour demand is holding up better than the headline job numbers suggest.'
'paint a worrying picture'
'starting to sag'

11.23am GMT

Simon French, chief executive of Panmure Gordon, has a balanced take on today's jobs report:

Something for everyone in latest UK labour market stats. Unemployment rate falls back to 3.8% & vacancies remain high by historical standards - but signs of softness in demand as total employment QoQ falls back - consistent with a weakening picture from recent recruiter surveys. pic.twitter.com/jp4cyuRpAi

Final thought on today's UK jobs numbers. There have been at least 4 soft patches (QoQ declines) in the last 7 yrs as UK emp rate has moved higher. On each occasion momentum was regained. So today's decline has precedents - but is unnerving against backdrop of weak output growth. pic.twitter.com/gaUq1FBMgg

11.08am GMT

The drop in part-time workers has hit women workers harder than men (as they are more likely to be working part-time, jugging work and family commitments).

The ONS says:

The number of part-time workers fell by 164,000 to 8.54 million in Quarter 3 2019, while the number of full-time workers increased by 106,000 to 24.21 million.

The decline in part-time workers was driven by women (down 106,000 in the quarter) and the increase in full-time employment by men (up by 93,000 in the quarter).

10.50am GMT

Young people and part time workers are bearing the brunt of the UK jobs slowdown, as these charts from ING show:

The recent fall in employment has been predominantly driven by 18-24 year-olds, and once that group is stripped out, jobs growth is still positive. A large chunk of the fall has also been led by part-time employees. It's not clear whether these two factors are linked, but both can be reasonably volatile parts of the jobs data.

But with forward-looking hiring indicators deteriorating, and given the risk that Brexit uncertainty persists into 2020, there's a clear risk the jobs market deteriorates further over coming months."

10.43am GMT

Geraint Johnes, Professor of Economics at Lancaster University Management School, has spotted that the number of part-time workers has fallen very sharply over the summer.

More than 100,000 more workers were employed full-time over the latest three-month period than in the previous quarter. This increase is roughly evenly split between employees and self-employed workers. Set against this good news, however, is a very large decline in numbers of part-time workers - a fall of 160,000 in total.

Overall, therefore, the number of people in employment has fallen. This is accompanied by a rise in the numbers of people who are economically inactive - especially amongst 18-24 year olds. Meanwhile, unemployment has fallen by some 23,000 and the unemployment rate is back down to 3.8%.

10.38am GMT

Britain's bosses are worried that the UK jobs market is under strain

Tej Parikh, chief economist at the Institute of Directors, says some firms are putting projects on hold due to political and economic uncertainty (thanks to Brexit and the general election).

"With so many in work there has been a lift to household incomes, which has supported the economy through a challenging period. However, businesses are now finding it harder to access the talent needed to fill openings, so jobs growth is expected to slow further.

Many firms are also putting recruitment plans on ice as wider projects and investments are bottled up by uncertainty. Vacancies are likely to continue falling.

"The pick-up in wage growth earlier this year has been a plus, but there is clearly a limit to how high pay packets can go. With many firms facing elevated costs and difficulties raising their productivity game, the margins to raise pay are eroding. A further acceleration in wages now looks unlikely.

10.30am GMT

TUC General Secretary Frances O'Grady is disappointed that wage growth has slowed in the last quarter.

Although wages (+3.6%) are rising faster than inflation (+1.7%), this doesn't make up for falling real wages in recent years (see figure 4, here).

"Working families are thousands of pounds out of pocket after a decade of dismal pay growth. That is not right.

"The Conservatives have presided over the longest wage squeeze since Napoleonic times. They have nothing to boast about.

10.23am GMT

Here's the Office for National Statistics's take on today's data:

"The employment rate is higher than a year ago, though broadly unchanged in recent months.

"Vacancies have seen their biggest annual fall since late 2009, but remain high by historical standards.

10.06am GMT

Britain's employment rate has dropped to 76%, from 76.1%, in the last quarter as the number of people in work fell by 58,000.

That's still close to a record high, following a steady recovery since the financial crisis

9.46am GMT

More bad news. The number of vacancies in the UK economy has fallen by 14,000 in the last quarter.

That's the biggest quarterly decline since 2009, according to the ONS.

Not the greatest set of UK labour market data on first glance:
" Wage growth weaker than all forecasts
" Employment down 58,000 in Q3 (biggest drop since mid-2015)
" Job vacancies fall to 800,000 -- biggest annual drop since 2009

Will bolster BoE doves' views.

9.41am GMT

In a blow to workers, wage growth has slowed.

Average earnings rose by 3.6% per annum in the July-September quarter, the Office for National Statistics reports (both including and excluding bonuses).

9.36am GMT

Newsflash: The number of people in work across the UK has fallen, in a sign that Britain's labour market may be weakening.

The employment total fell by 58,000 in the three months to September, according to the latest Labour Market statistics.

9.15am GMT

Nearly 30% of European car exports go to the US at present, so the industry would obviously be relieved if Trump delays imposing a new 20% tariff.

But... pushing the decision back by six months also creates uncertainty, and another cliff edge dilemma next May.

This sword of Damocles will be kept dangling for a long time to come, I suspect > > Trump expected to delay auto tariff decision for 6 more months https://t.co/GWuU0o2Nb3 via @politico

9.08am GMT

Land Securities, which owns the Bluewater shopping centre in Kent, has slumped to a first-half loss, hit by a raft of store closures as retailers struggle against weaker consumer spending and a shift to online shopping.

The property firm posted a 147m loss for the six months to September, against a 42m profit a year earlier. Rental income at its retail division fell by 2m or 1.5% while offices fared better, up 3m or 2.5%. Shopping centres outside London are struggling in particular, where footfall was down 1.8%.

About 3.6% of the firm's retail space stood empty, a slight improvement on the 4% recorded at the end of March, but there were more units in administration (1.4% against 0.9% in March).

"The retail market continues to be challenged as retailers adapt to structural change, rising costs and a more cautious consumer " Limited demand for space and poor investor sentiment is impacting rental and capital values.

We have seen further high-profile CVAs and administrations in the period, notably Debenhams and Arcadia. Clearly, we are not immune from these trends but, where we have been hit by CVAs, our assets remain popular with occupiers and customers. And where stores have closed, we have had reasonable re-letting success - with more than half of units re-let or in solicitors' hands as at 30 September."

8.52am GMT

Premier Foods shares are up 7.7% to 35.9p in early trading.

8.47am GMT

Broadcaster ITV is the best-performing FTSE 100 share, up almost 3%, after it reported a rise in advertising revenue in the last quarter.

8.39am GMT

This morning's trade war optimism is helping to lift European markets.

Most of the main indices are higher, led by Germany's DAX (+0.4%). Car makers, industrial groups and tech firms are all rallying.

All eyes will on Donald Trump after markets close in Europe as the president is due to deliver a speech at the New York Economic Club later, expected at 17:00 GMT.

This poses all kinds of risks - on everything from China and trade to the Fed and impeachment. Markets will be on tenterhooks. The president's speeches are akin to throwing a dart blindfolded.

8.28am GMT

Shares in European carmakers are rising in early trading.

Daimler (+1.25%), BMW (+1%) and Volkswagen (+0.7%) are all among the top risers in Frankfurt.

8.22am GMT

European Union officials are also quietly optimistic that Trump will resist triggering the car tariffs this week.

One told Reuters:

"We have a solid indication from the administration that there will not be tariffs on us this week."

8.12am GMT

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

That would avoid a new bruising dispute with one of the United States' biggest trading partners, just as Trump is trying to put out another trade fire by striking an initial deal with China. But it would also set the stage for Trump to revisit the controversial trade issue in the throes of next year's presidential campaign.

The person with familiar the decision cautioned there is always uncertainty surrounding Trump's final determination when it comes to trades and tariffs. But barring some unforeseen development, the president is expected to announce another six-month delay, the person said.

#Trump expected to delay auto tariff decision for 6 more months - Politicohttps://t.co/Anl9pO8QSw

"Trump is going to make some criticism, but there won't be any auto tariffs.

He won't do it. ... You are speaking to a fully informed man."

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