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VIDEO: Jobless total close to rate trigger

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Unemployment has fallen to 7.1% - within touching distance of the figure which will be used to decide whether interest rates will increase, official data have revealed.

The number of jobless people plunged by 167,000 in the quarter to November - the second biggest fall on record - to 2.32 million, the lowest for almost five years.

The Bank of England’s monetary policy committee (MPC) has said it will not lift interest rates above their historically-low level of 0.5% until the unemployment rate drops to 7%.

Analysts had not expected the threshold to be reached until later in the year, although the Bank has stressed a figure of 7% will not automatically trigger an interest rate rise.

The new unemployment rate of 7.1% is down by 0.5% from June-August, and by 0.6% from a year earlier.

The quarterly fall of 167,000 is the biggest since the autumn of 1997 and the second largest since records began in 1971.

The number of people claiming jobseeker’s allowance in December fell by 24,000 to 1.25 million, the lowest figure for almost five years.

The so-called claimant count has now fallen for 14 months in a row.

Meanwhile, the number of people in work has reached a record high of just over 30 million, giving an employment rate of 72.1%, an increase of 0.5% over the quarter to November.

An additional 280,000 people were in employment over the latest quarter compared to the three months to August, and up by 450,000 from a year earlier.

There was a fall in the number of people working part-time because they could not find full-time jobs - down by 12,000 to 1.4 million.

Economic inactivity - counting those who are looking after a relative, on long-term sick leave or who have given up looking for work - fell by 22,000 to just under nine million.

Average earnings increased by 0.9% in the year to November, unchanged from the previous month, giving a weekly wage of £475, today’s report from the Office for National Statistics showed.

Long-term unemployment has fallen - down by 61,000 to 839,000 among those out of work for over a year.

The number of unemployed 16 to 24-year-olds fell by 39,000 to 920,000.

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