The Office for National Statistics (ONS) said today the UK employment rate was 76.1% – the joint-highest on record since comparable records began in 1971, and higher than a year earlier (75.5%).
Pawel Adrjan, UK economist at the global job site Indeed said, “The labour market is finally running out of headroom. With Britain’s jobs boom slipping into the rear view mirror, the number of new jobs being created has slowed substantially; just 31,000 over the past quarter, a number so small it is within the statistical margin of error.
“But this is not yet a decline, more a pause for breath. Both the employment and the unemployment rates are holding steady, which is a significant achievement against the backdrop of a stagnant economy and risk-averse employers who are growing increasingly reluctant to hire.
“While there are still 812,000 jobs available, the total number of vacancies has been falling steadily since January, as employers, particularly small businesses fret about the economic outlook.
“So while it’s ‘steady as she goes’ on the jobs numbers, workers are reaping the dividends in their paypackets. Average wages rose by a relatively brisk 3.8% over the past year, driving inflation-adjusted salaries back up to within just a few Pounds of their pre-crisis peak.
“The steady rises in wages are a side-effect of the tightness in the labour market, as recruiters ramp up salaries in an effort to lure new recruits and retain existing staff.
“On the recruitment front line, that battle for talent is still raging. And with the economy clearly hovering at the full employment mark, wage inflation is likely to continue – unless and until a recession takes the wind out of employers’ desire to hire.”