The slowdown in the economy is taking its toll on the UK labour market as the number of Britons seeking jobseekers’ allowance rose for the fourth month in a row, increasing by a higher-than-expected 9,000 claimants.

Figures from the Office for National Statistics (ONS) also revealed today that the number of benefit claimants in April has been revised upwards to 11,200 from the previous estimate of a 7,200 increase, signalling the largest rise since April 2006.

Analysts had expected claimant numbers in May to reach 6,700, far below the 9,000 figure revealed today. The ONS also said that the unemployment rate in the three months to April rose 0.1 per cent on the previous quarter to 5.3 per cent.

The rate of employment during the quarter ended in April remained static at 74.9 per cent, while the number of people in employment increased by 76,000 over the three months.

While the number of jobseeker claimants is rising, the Bank of England will find some comfort in today's figures, which show that rising inflation is yet to have a material effect on wages.

Average earnings, which include bonuses, rose by 3.8 per cent in the three months to April, down from 4 per cent in the previous three months and below forecasts for a rise to 4.2 per cent.

Excluding bonuses, earnings growth rose to 3.9 per cent over the three months from 3.8 per cent in the previous period.

Howard Archer, chief UK and European economist at Global Insight, said: “At last some good news for the Bank of England on the inflation front. However, the big question for the Bank of England is will wage growth remain contained given sharply higher inflation and rising inflation expectations?

"We suspect that wage moderation will continue as an increasingly softening labour market limits workers' bargaining power and companies become ever more determined to limit their wage bill as other input costs soar."

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