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Despite government support measures, the UK unemployment increased in the three months to October and redundancies reached a record high as the coronavirus pandemic weighed on the labor market.

The unemployment rate rose to 4.9 percent in three months to October, the Office for National Statistics reported Tuesday. Economists had forecast the rate to climb to 5.1 percent from 4.8 percent registered in three months to September.

The number of people looking for jobs increased by 241,000 from the previous quarter.

The unemployment is set to rise to 6 percent by year-end, despite unprecedented wage support which probably meant over four million people were furloughed during the November lockdowns, ING Economist James Smith, said.

Data showed that redundancies increased by a record 217,000 on the quarter, to a record high of 370,000.
“The re-introduction of tighter restrictions and the expected cliff edge caused by the original furlough scheme end date in October helped driverecord redundancies,” British Chambers of Commerce Head of Economics Suren Thiru said.

With businesses facing the prospect of further restrictions and a messy end to the Brexit transition period, major job losses remain probable in the near term, Thiru added.

The employment rate decreased 0.5 percentage points from the preceding period to 75.2 percent in three months to October.

In three months to October, total pay including bonuses increased to 2.7 percent from last year, and growth in regular pay, excluding bonuses gained to 2.8 percent.

In November, the number of people claiming unemployment benefits increased 64,300 from the previous month.


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