as the country braces itself for a prolonged two-year recession.
Almost 9 million people are neither in work or looking for work, so they don't show up in the unemployment figures. Although today's figures show that the jobless rate rose it is still close to record lows, largely because of a surge in economic inactivity, which is flattering the headline rate of unemployment.The tightness of the labour market over the past year did provide some opportunity to those in work and looking for work, with some managing to negotiate chunky pay deals.
The tight labour market failed to deliver meaningful pay rises to workers, with inflation leaving households poorer than they were earlier in the year.Policymakers at the Bank have been fretting about the prospect of a"wage-price spiral," whereby higher wages push up inflation even more, forcing them to raise interest rates even higher.