Jobs market stable despite uncertainty and #Brexit turmoil

ONS labour market statistics: jobs market stable despite uncertainty and Brexit turmoil

The UK jobs market remained stable in the three months to September with the employment rate down by just 0.1% compared to the previous quarter. Total employment now stands at 76.0%, 0.5% higher than last year, according to new figures from the ONS. The unemployment rate decreased slightly from 3.9% last quarter to 3.8%.

The number of job vacancies continued to fall to 800,000, 18,000 fewer than the previous quarter and 54,000 fewer than the previous year. Last week the Recruitment and Employment Confederation’s Report on Jobs (RoJ) showed that employers were delaying or cancelling hiring plans amid continued Brexit uncertainty. Employers are looking for a green light to start investing and hiring again as soon as possible.

The REC and its members are calling on all political parties to back policy recommendations to boost the economy and support workers, with a manifesto to make great work happen.

Neil Carberry CEO at the Recruitment & Employment Confederation, said:

“The UK labour market has shown incredible resilience in the face of uncertainty and political turmoil. This year has seen record numbers of people in work and there are big opportunities out there. But the warning signs are there in the form of slowing jobs growth and falling vacancies while REC data shows skills shortages across a number of sectors like construction and retail. This is why the election in 30 days needs to be about work. There are few things voters consider to be more important than this.

“REC RoJ data shows that employer confidence in the economy is at a low-point. Businesses are delaying hiring and rolling back investment plans. This is reflected in declining vacancies and rising unemployment. The next government must make reversing this trend a top priority.

“This is why our manifesto asks all parties to commit to making great work happen. Putting people at the heart of the industrial strategy – including through good recruitment – is an essential part of addressing the UK’s productivity problem. Our manifesto lays out a number of policy asks which together would support and protect workers while boosting business growth.”

Suren Thiru, Head of Economics at the British Chambers of Commerce (BCC), said: 

“Although the UK’s unemployment rate remains very low by historic standards, falling employment is further evidence that the labour market is starting to sag under the weight of a lethargic economy, rising cost pressures and unrelenting uncertainty. 

“The continued fall in the number of vacancies suggests that employment growth could slow further over the near term. Businesses report that they are facing persistent recruitment difficulties, which are increasingly putting some off from attempting to hire new staff. 

“Although pay continues to rise faster than prices, the slowdown in regular earnings growth is disappointing. While wage growth in real terms is likely to remain in positive territory over the near term a sluggish economy, weak productivity and high upfront costs for businesses will increasingly weigh on pay settlements. 

“Any incoming government must safeguard the long-term health of the labour market, including by setting out a long-term strategy and funding for lifelong learning to help people to upskill and retrain.” 

Responding to today’s Office for National Statistics Labour market overview, Alexandra Sydney, Director at Totaljobs, said:

“Today’s ONS labour market stats show that vacancies have fallen, yet overall these continue to remain strong compared to historical figures. Despite a drop in the number of people in work, the employment rate is also still higher than a year ago, resulting in a candidate-led market with employers competing to attract the best talent. Our recent survey with Universum of more than 16,000 UK workers has shown that 54% are looking to take advantage of this and change jobs in the next year – and a staggering 38% are looking to change jobs in the next six months.

“We know from our research that money isn’t always the key driver in job satisfaction – benefits including clearer progression paths, flexible working styles and making more training opportunities available should be prioritised to create better working environments. With the approaching election and economic uncertainty, employers and employees alike need to take stock of the opportunities available to them.”

REC Manifesto

Policy recommendations include:

1. Accepting that people work in a range of different more flexible ways because it works for them, and designing policy that reflects this new normal. A priority would be to ensure the apprenticeship levy works for flexible workers too.
2. Acknowledging that people need to be at the heart of the industrial strategy, with a new focus on staff engagement and to promote productivity growth, opportunity and inclusion. The REC wants to work with Government on a new Good Recruitment Taskforce to help drive good recruitment.
3. Ensuring regulation is fit for purpose, by delaying IR35 changes until it’s clear that compliant firms won’t lose out, with effective regulation of umbrella companies a necessity.
4. Building an immigration policy that works for our economy and public services by addressing skills and labour shortages.  A temporary visa designed to address key shortages at all pay levels is essential. Also a clear and well run work permits system.
5. Engaging with business on making sure the UK is ready for the work of the future, and that public policy can keep step.