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Wednesday, October 13, 1999 Published at 07:02 GMT 08:02 UK

Business: The Economy

Jobless total set to fall

Fewer people were out of work last month

The latest unemployment figures for the UK, due out at 0930 (0830) on Wednesday, are expected to show a further fall.

Analysts expect that the jobless total will have fallen a seasonally-adjusted 15,000 in September.

Economists will be watching the figures - especially average earnings - closely for clues as to the future direction of UK interest rates.

With the jobless rate at the lowest levels for nearly 20 years, there have been fears - so far largely proving unfounded - that wages may be forced up by the falling numbers of available employees.

If this was to happen the Bank of England would be expected to raise interest rates to cool down the economy in order to avoid a rise in inflation.

The latest figures, for August, showed the claimant count fell 22,300 to 1.2 million, while the unemployment rate was 4.2%, down from 4.3% in July.

Headline average earnings are expected to have risen 4.7% year-on-year, compared with a 4.6% rise in the three months to July.

But the picture is patchy across the country. Some areas still have high unemployment levels, while others are suffering skills shortages.

Paul Convery, joint director of the Unemployment Unit, said many towns near London, such as Crawley, had extraordinarily low unemployment.

But Leeds had a booming economy, yet still had high levels of joblessness, he added.

He said the government's flagship New Deal jobs programme was helping reduce unemployment, but it was focusing mostly on youngsters and economically inactive people such as the disabled.

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