THE number of people in work has reached a new record, while earnings have grown in line with inflation, new figures show.

Employment increased by 197,000 in the quarter to March to 32.3 million, the highest figure since records began in 1971, giving a record rate of 75.6 per cent.

Unemployment fell by 46,000 to 1.42 million, giving a jobless rate of 4.2 per cent, the lowest since 1975, according to the Office for National Statistics (ONS).

Business groups and unions welcomed the record level of employment, but wages were still said to be lower than a decade ago.

Matthew Percival, the CBI’s head of employment, said: “It’s good to see rising wages alongside strong jobs growth. The challenge now is to embed wage increases through sustained productivity growth, helping to improve living standards right across the UK.”

Young Women’s Trust chief executive Dr Carole Easton said: “We welcome the record rate of employment but today’s figures show that half a million young women are still out of work and full-time education.

“Young women tell us they want to work and be able to live independently, but insecure work, low pay and gender discrimination are holding them back.

“It’s not just families that are losing out from this but businesses and the economy too.”

TUC general secretary Frances O’Grady said: “Working people are still not getting a fair deal. Millions of jobs do not pay a real living wage, and average weekly pay is still worth much less than a decade ago after the longest pay squeeze for 200 years.”

Seamus Nevin of the Institute of Directors said: “Workers will welcome the slight boost in wages - the first they’ve seen for more than a year - but the rise is nothing to write home about.

“The only reliable way to boost workers’ pay packets is to increase productivity. Investment in training is key.” but the drop in apprenticeship starts since the Government’s levy was introduced shows the system needs reform now if we are to train the people we will require for our shifting skills needs as the post-Brexit economy evolves.”

Stephen Clarke of the Resolution Foundation said: “Britain started 2018 as it has spent much of the last decade, with more impressive jobs growth but little prospect of recovering from its disastrous record on pay.

“While the return to pay growth is very welcome it remains anaemic and wages are still over £700 a year lower than they were a decade ago.”

Suren Thiru of the British Chambers of Commerce said: “With unemployment declining and employment levels continuing to rise, the latest data confirms that the labour market remains a bright spot for the UK economy.

“However, while the latest figures are likely to reinforce the Monetary Policy Committee’s hawkish rhetoric, labour market data tends to lag behind the wider economy, so any broader weakening in economic conditions wouldn’t be expected to appear in the figures for some time.”