The number of people out of work continues to drop, but the boss of East Midlands Chamber said it was as vital as ever for businesses to invest in skills.
The chamber said the regional unemployment rate hit a recent low at 3.1 per cent over the winter, down from 3.4 per cent for the previous quarter. It compares to a UK average of 3.9 per cent.
Only three other regions had a better rate – the South West of England, Wales and Northern Ireland.
Nationally the Office for National Statistics (ONS) said there were 1.34 million unemployed in the quarter to January – down 88,000 on the previous three months and below the 1.36 million recorded in December to February 2020.
But the ONS also highlighted the tightening squeeze of the cost-of-living crisis, as regular pay failed to keep up with soaring inflation, with average weekly earnings excluding bonuses up 3.8 per cent between November and January.
Some East Midlands businesses, though, have been stepping up pay to help out staff, with Nottingham-based auctioneers John Pye announced it was increasing its entry level minimum wage to £10 per hour on April 1, which is above the National Minimum Wage.
East Midlands Chamber chief executive Scott Knowles said: “It’s fantastic news for the region’s labour market that the unemployment rate has plummeted in recent months, hitting a fresh new low for the beginning of this year.
"Amid so much uncertainty in the world at the moment, it sends a clear signal that the East Midlands is open for business and recovering strongly from the direct impacts of the pandemic.
“The improving picture reflects our own research, which indicates our region’s firms are creating jobs to meet strong demand following the removal of restrictions.”
He said the chamber’s recent quarterly business survey showed one in five businesses increased their workforce in the previous three months, while a third hoped to take on more workers in the coming quarter.
Mr Knowles said: “We are represented by a very diverse economy in the East Midlands – ranging from logistics and services to hospitality and tourism – while our manufacturing industry continues to play a hugely important role, with our region having the highest proportion of production sector jobs at 12.2 per cent.”
He added: “With more people leaving the labour market and fewer overseas workers to choose from since the end of the UK-EU transition period just over a year ago, we are beginning to see emerging skills gaps across numerous industries.
“With the cost of business continuing to rise amid surging inflation and price rises in aspects such as energy, supplies and people, the impact this will have on business growth – which ultimately fuels local job creation and wealth – remains a considerable worry.
“Two-thirds of East Midlands businesses told us they have seen price rises and cashflow is now down for the first time in over a year.
“All this highlights the importance of investing heavily in skills, something that was highlighted in the Government’s Levelling Up White Paper as one of its 12 ‘missions’ but must now be prioritised with rapid action to ensure our post-Covid and post-Brexit economic recovery doesn’t stall.
“With the Spring Statement also coming up next week, this is a timely reminder that the Chancellor must not impose any new costs or taxes on businesses, and should also delay the introduction of the planned National Insurance rise.”
