UK job vacancies fall in early sign labour market may weaken
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UK job vacancies fell for the first time since August 2020, an early sign that the nation’s red-hot labour market may be starting to cool.
The number of jobs employers are seeking to fill fell by 19,800 to 1.27 million in the quarter through July, the Office for National Statistics said on Tuesday (Aug 16). The economy created 160,000 jobs in the second quarter, 46 per cent less than the 3 months through May.
The figures are among the most forward-looking measures in the government’s monthly jobs report and add to evidence the economy may be slowing under the weight of a cost-of-living crisis and inflation at a 40-year high.
The pressure on households was highlighted by figures showing that wages excluding bonuses and adjusted for inflation fell by 3 per cent in the 3 months through June, the biggest drop since records began in 2001.
The figures suggest the tightness of the labour market is easing as workers struggling with cope with soaring energy and food bills.
Bank of England (BOE) policymakers led by governor Andrew Bailey are concerned the labour market is still running too hot and have signalled plans to keep raising interest rates to prevent rampant inflation causing a wage-price spiral.
Further out, the prospects are less bright, with the BOE predicting unemployment will rise to over 6 per cent as the cost of living crisis weighs on the economy. BLOOMBERG
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