UK jobless rate rises to highest since early 2016 at 5.1% By Reuters

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© Reuters. Official figures are published for UK GDP

LONDON (Reuters) – Britain’s unemployment rate rose to 5.1% in the last three months of 2020, official data showed, its highest since the first quarter of 2016 but still a lot lower than it would have been without the government’s coronavirus jobs support scheme.

Separate data from the Office for National Statistics showed that the number of employees on company payrolls in January rose by 83,000 from December.

The jobless rate was in line with the median forecast in a Reuters poll of economists.

The January increase in payrolled employees between December and January was the highest since January 2015.

Unemployment has been suppressed by the government’s Job Retention Scheme which is supporting about one in five employees.

The programme is Britain’s most expensive COVID economic support measure and will cost an estimated 70 billion pounds ($98 billion) by its scheduled expiry date of April 30.

The Bank of England has said it thinks the unemployment rate will jump to almost 8% in mid-2021 after the scheme ends.

However, finance minister Rishi Sunak is expected to announce an extension of his jobs support, at least for sectors hardest hit by the government’s lockdowns, in a March 3 budget statement.

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