The UK employment rate was slightly down, at 75.9%, in the quarter to August 2019, while the unemployment rate was estimated at 3.9%, compared with 3.8% in the previous quarter.
The latest bulletin from the Office for National Statistics (ONS), which can be found at https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/uklabourmarket/october2019¸ also shows that, after adjusting for inflation, annual growth in total pay was estimated to be 1.9%.
Responding to the figures, Tej Parikh, Chief Economist at the Institute of Directors (IoD), said: “Challenging economic conditions are starting to take the shine off the UK’s job boom.”
Firms are now increasingly coming up against uncertainty and the shrinking supply of available talent, he pointed out, and, unable to fill positions, many are responding by simply taking down vacancy postings.
“After a promising pick-up, wage growth also appears to be cooling off slightly,” Mr Parikh continued. “With higher costs, low productivity, and cloudy cashflow forecasts on the menu for SMEs, many are reaching the heights of what they can viably offer workers.”
The CBI agreed that firms are becoming more cautious in hiring staff, with vacancies edging down and pay growth potentially at its peak, with TUC General Secretary Frances O’Grady blaming the threat of “the hardest possible Brexit”.
This is hitting the labour market, she argued, calling for MPs to refuse to support any deal that will hurt workers’ rights, jobs and livelihoods.
The gloomy outlook was continued in the latest “UK Report on Jobs” from the REC (Recruitment and Employment Confederation) and KPMG which suggests that heightened political and economic uncertainty regarding Brexit continued to weigh on hiring activity at the end of the third quarter.
REC chief executive Neil Carberry said: “Businesses are positive about their own prospects, but ongoing Brexit uncertainty has led many firms to delay projects and hiring decisions. Vacancy growth has fallen to its lowest since 2012.”
For KPMG, vice chairman James Stewart highlighted the weakest increase in job vacancies since 2012 and the longest period that permanent staff appointments have fallen since the global financial crisis.
“The Brexit impasse continues to affect the jobs market with employers stuck, unable to make informed decisions, and people unwilling to risk seeking new roles,” he concluded.
Comment by Croner Associate Director Paul Holcroft
With Brexit uncertainty continuing to dominate headlines, it's not surprising that many employers are playing it safe when it comes to taking on new staff.
I would remind employers that we still do not know what is going to happen with Brexit. Currently, there is no confirmation that we will face a no-deal scenario.
While we wait for Brexit day, I would advise employers to combat recruitment worries by focusing their attention on upskilling their current staff. Employers can do this by identifying those with potential and providing training to help them progress in the company.
Last reviewed 22 October 2019