The rate of unemployment in the U.K. was 3.9 percent in April, unchanged compared to January, according to figures published Tuesday morning by the Office for National Statistics.
Experts were predicting a significantly worse figure, with some expecting the biggest single-month drop in employment on record.
The rate of welfare benefit claimants, however, jumped by 528,000 in May, reaching 2.8 million. That is an increase of 125.9 percent compared to March, when Britain entered lockdown to control the spread of the coronavirus pandemic.
Although welfare claimants are not necessarily unemployed, the number is seen as a key gauge for the health of the labor market.
Meanwhile 612,000 fewer people appeared on employers’ payrolls in May compared to March, the data showed.
The figures will be a boost for Chancellor Rishi Sunak, whose furlough scheme is credited by experts as holding unemployment at bay, but some warn the worst may be yet to come.
“The key acid test for the UK labour market, however, is July/August, when the furlough scheme begins to unwind,” tweeted analyst Michael Brown, from Caxton FX, a foreign exchange group.
Tej Parikh, chief economist of the Institute of Directors, a private sector advocacy group, said:”The furlough scheme continues to hold off the bulk of job losses, but unemployment is likely to surge in the months ahead.” He added: “As many as a quarter of firms have said they will struggle to pay anything toward furloughed workers’ pay come August.”