UK jobs market was in a fragile state – even before Iran war threatened recovery

UK labour data showed a mixed but still fragile picture ahead of next week’s Bank of England meeting: unemployment unexpectedly fell to 4.9% in the three months to February from 5.2%, but payrolled employment continued to shrink, down 65,000 year on year in March. Annual total pay growth slowed to 3.8%, with private-sector regular pay at 3.2% and real pay growth just 0.7%, the weakest since mid-2023.