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Last Updated: Wednesday, 14 March 2007, 11:05 GMT
Further fall in UK jobless total
Jobseekers looking for vacancies
Unemployment has been falling for several months
The number of people unemployed in the UK fell marginally in the three months to January, continuing its recent downward trend.

The jobless rate fell by 3,000 to 1.69 million in the period, figures from the Office for National Statistics showed.

The number of people claiming unemployment benefit fell by 3,800 in February to reach 922,200.

But the number of manufacturing jobs fell by 59,000 to 2.97 million, the lowest comparative level since 1978.

Many manufacturers have said that recent interest rate rises plus the strength of sterling, which makes life tougher for exporters, have hit them hard.

Market weakening?

The unemployment rate remains at 5.5%, lower than in many European countries but higher than in the United States and Japan.

Unemployment has been falling for some time but the most recent decline is the smallest for several months.

An improving labour market has so far, at least, not fuelled sharp overall rises in pay
Howard Archer, Global Insight chief economist

But the figures also reveal a rise in the number of people not looking for work.

Those classified as "economically inactive", such as students, the long-term sick and those opting out of the job market for whatever reason, rose by 42,000 to 7.88 million.

Recent surveys have suggested that firms are reasonably confident about their short-term economic prospects and their need to recruit new staff.

The number of job vacancies rose by 24,800 to 622,800 over the past quarter.

Wage growth 'benign'

The ONS figures also showed that average earnings rose by 4.2% in the year to January, up from a rate of 4% in the previous month.

Analysts said the rise in average earnings was distorted somewhat by hefty City bonuses paid out at the end of last year.

"The underlying picture appears to be pretty benign," Howard Archer, chief UK economist at Global Insight, said of the wage growth figures.

"An improving labour market has so far, at least, not fuelled sharp overall rises in pay. This is broadly backed up by the latest survey evidence which shows some upward movement in pay settlements, but not substantial increases."

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