The UK unemployment rate fell to 3.8% in May to July, while the estimated employment rate remained at a record 76.1%.
The unemployment rate was last lower at the end of 1974.
There were a total of 32.78 million people aged 16 or over in employment, with the increase mainly driven by more women in work.
There was a rise of 284,000 employed women over the year to a total of 15.52 million. Male employment also rose by 86,000 to reach 17.26 million, mainly because of rising numbers of self-employed.
However, the number of people aged between 16 and 64 considered economically inactive continued to rise, increasing by 6,000 to 8.59 million, according to the figures from the Office for National Statistics.
Earnings excluding bonuses grew at an estimated annual pace of 3.8%. Including bonuses, wages rose at an annual pace of 4%, the highest rate since mid-2008.
Nicola Inge, employment and skills campaign director at Business in the Community, a charity and the Prince’s responsible business network, said wage growth creates confidence, which could be key in helping the UK economy survive during the months ahead.
“The UK jobs market may be robust on the surface but there is a lot of anxiety across the workforce and employers need to manage that carefully,” she warned.
Jon Boys, economist at the CIPD, said strong pay growth is largely being driven by labour shortages in sectors like construction.
“For this to continue in the long-term, businesses must improve their productivity. It’s also essential that they look at how they recruit, manage and develop their workforce given our uncertain political climate right now,” he added.