UK's Quarterly Employment Growth Has Hit Its Highest Level For At Least 43 Years

SMEs and other companies are continuing to increase staffing levels, with unemployment falling to a five-year low.

The latest figures from the Office for National Statistics have revealed the number of people in work rose by 283,000 in the three months to March 2014, the largest quarterly increase since comparable records began 43 years ago.

It means there are 722,000 more people in work than a year ago, with the UK workforce expanding to a new record high of 30.43 million. Overall unemployment fell by 133,000 in the last quarter, to 2.21 million or 6.8 per cent of the workforce.

There are also signs that the employment situation is improving for young people, a group that has been hit particularly hard by the economic crisis. The number of people aged 16-24 who are not in work or full-time education fell by 48,000 in the last quarter and has now dropped for eight successive months.

Employment minister Esther McVey said those setting up small businesses were among those who have been gaining work as a result of the improving economic outlook.

She said: "As the recovery takes hold, more people are able to get a job or set up their own business and become the employers of tomorrow. Each and every person who has made a new start or hired someone new is helping to make Britain a more prosperous and confident place to be."

The improvement in economic conditions is expected to continue to make the prospects for those setting up or growing a business increasingly favourable, with the Bank of England's Quarterly Inflation Report published this week indicating further good news ahead.

It also said that rises in interest rates will probably be gradual and remain low by historic terms, which is good news for those repaying loans taken to fund business growth.

However, the report did note some SMEs are still finding it difficult to access funding from banks, which may hold them back unless they can find funding from other sources.

Expert Opinion

It is hugely positive to see official employment figures reflect what so much other research has indicated – that the economy is improving and, as a result, many businesses are looking to expand their workforces and take on new recruits. <br/> <br/>"While this is of course a great sign of progress, small businesses in particularly should not ignore the key regulatory issues that taking on new staff can raise. There are a range of issues to consider when growing staff numbers, such as the need to ensure proper contracts are in place and that the right HR policies are enforced to ensure employees understand what is expected of them in their role. <br/> <br/>"Such issues are basic necessities for employers to consider and we would urge any SMEs looking to push on with recruitment to ensure their house is in order beforehand. The risks of failing to do this could be significant." Fergal Dowling - Partner