BoE's Mark Carney: British Business Has Room to Hire

The Bank of England's Governor has said that there is room for British business to hire more people as the country continues its economic recovery.

Mark Carney, speaking to Treasury Committee in the House of Commons, said he believed there is "some spare capacity in firms as well as in the UK's labour market", but stressed others on the central bank's interest rate setting Monetary Policy Committee (MPC) had varying opinions.

Carney's comments come after the Office for National Statistics (ONS) recently revealed that the country's unemployment rate slightly rose to 7.2% in the three months to December 2013.

"What we've learnt over the course of the last seven months since we put in place the first phase of forward guidance, or so what I've learnt, is that that equilibrium rate of unemployment has gone down," Carney said.

He added: "It's lower than we would have thought in August and in August we estimated as a committee that it was about 6.5%.

"I personally would mark it around 6% now, potentially slightly lower.

"So we have a 7.2% unemployment rate a year at present, relative to a medium-term equilibrium level of about 6%."

The news comes as the BOE's base interest rate is currently at its record-low of 0.5% as part of a package of extraordinary monetary policy measures to keep the economy moving in the aftermath of the financial crisis.