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The UK unemployment rate fell to 4.8% in the first three months of the year despite strict coronavirus lockdowns as the government's wage-subsidy scheme continued to support the labor market and the number of people looking for work fell, official figures showed on Tuesday.
Separate data showed the recovery in job vacancies continued into April as businesses geared up for the reopening of the economy.
The headline unemployment rate of 4.8% was down from 5.1% in the final quarter of 2020, when COVID-19 cases soared, causing new restrictions to be put in place in January. But it was up 0.8 percentage points from a year earlier, the Office for National Statistics said.
ONS director of economic statistics Darren Morgan said: "The renewed lockdown at the beginning of 2021 saw a sharp rise in the number of previously unemployed people no longer looking for work, helping the unemployment rate fall on the quarter." The unemployment rate only measures people actively looking for work.
The pound was up 0.33% against the dollar at $1.418 on Tuesday.
Britain is gradually reopening its economy from tight lockdowns put in place in January after coronavirus cases soared in the winter.
The country's rapid rollout of vaccines has helped put the country on track to lift all restrictions in June, although the government has said it is concerned about the Indian COVID-19 variant.
The United Kingdom has one of the world's highest death tolls from COVID-19, with nearly 128,000 fatalities so far, according to data from the World Health Organization.
Schools reopened and restrictions on gatherings were relaxed in March, while businesses were gearing up for the reopening of non-essential stores and outdoor service at pubs and restaurants in April. Indoor hospitality reopened on Monday.
The outlook for the UK jobs market has improved considerably in recent months as a result of coronavirus vaccines and the ongoing reopening of the economy.
Whereas once it had predicted that unemployment would rise as high as 7.8%, the Bank of England now expects the jobless rate to peak at just 5.5%.
The government's furlough scheme, which has paid the wages of workers who might otherwise have been laid off, has held down the UK's jobless rate.
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