Unemployment in the UK hits 48-year low

Despite this seeming like a silver lining to the gloomy economic climate, the figures are misleading.

One of the most significant factors in the fall in unemployment is the rise in the UK's economic inactivity rate, which reached a five-year high of 21.7%.

The economic inactivity rate is the number of people who are not actively looking for work or are unable to work. Economic inactivity is not the same as the unemployment rate. The unemployment rate is the number of people looking for employment but cannot find it.

Another factor not accounted for is underemployment.

Underemployment is when someone is employed but not working full-time or must settle for a job that they are overqualified for. With the rise of the gig- economy in the UK (uber drivers, Deliveroo etc.) A large proportion who are technically employed are not earning nearly enough to survive during the ongoing cost of living crisis.

There is also the pay issue. Accounting for inflation, the value of regular pay has fallen by 2.8% as the squeeze on wages gets tighter. As energy bills soar, the coming winter is looking like it will be one of the toughest in living memory for the average person in the UK.

The new chancellor, Kwasi Kwarteng, made an impact on day one in post by sacking the highly experienced and popular permanent secretary to the Treasury, Tom Scholar. According to the Financial Times Kwasi Kwarteng has told anxious Treasury officials to adapt to a new approach focused on boosting annual economic growth to 2.5 per cent, as he prepares to unveil a tax-cutting mini-Budget next week.

Kwarteng has stated that: “With a strong and resilient economy, we deliver more jobs, higher wages, and raised living standards – all while reducing our debt-to-GDP ratio in a fiscally sustainable way.” So it will be intriguing to see his approach toward the fall in real wages in contrast to rising bills across the country.