Inflation in March was 2.5%.
"On balance, the combination of robust employment growth, falling unemployment and stronger underlying earnings growth, as well as a clear relapse in productivity in the first quarter, looks supportive to a Bank of England interest rate hike in August", said Howard Archer, chief economic adviser to the EY ITEM Club consultancy.
Average earnings of employees including bonuses grew 2.6 percent from a year ago, while earnings excluding bonuses advanced 2.9 percent in three months to March.
There were 1.42 million unemployed in the first quarter, which was 46,000 fewer than for October to December period. The unemployment rate of 4.2% was the joint lowest since 1975.
"Growth in total pay remains in line with inflation, meaning real earnings are flat on the year".
British government and sterling bonds did not move much when figures were released, that showed solid growth for jobs, unemployment sitting at decade low levels, but just a slight increase in pay for the majority of workers in Britain. There are now 32.34 million people in work, an annual increase of 396,000, including 256,000 full-time jobs.
The Office for National Statistics (ONS) figures show the unemployment rate for people aged 16 years and over was 4.2 per cent for the United Kingdom as a whole. "It's important to remember, though, that this isn't a measure of migration".
"Youth unemployment has fallen by over 40 per cent and the unemployment rate has not been lower since 1975".
"The figures once again cement that turnaround, with an employment rate of 75.6 per cent, and on average over 1,000 people each and every day, since 2010, getting a job".
"With wages growing faster than inflation and increases in the personal tax allowance, not only are more people bringing home a pay packet but they are keeping more of their hard earned money for themselves and their families".
Employment increased by over 197,000 during the first quarter of 2018, the largest jump since the latter part of 2015 and exceeded by a large margin analyst expectations of 130,000.