UK unemployment rises as pay growth lags behind high inflation

Softer conditions in jobs market means unemployment rate unexpectedly edges higher to 3.8%

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The UK's unemployment rate has edged higher and pay growth continues to lag well behind high inflation, according to the latest official data highlighting the dilemma faced by the Bank of England.

Reflecting softer conditions in the jobs market as Britain's economy struggles for growth momentum, the unemployment rate unexpectedly rose to 3.8% from 3.7%, the Office for National Statistics figures showed. The number of job vacancies also fell for a ninth consecutive month, although it remained high at more than 1.1m as companies struggle to recruit staff.