Latest employment figures highlight UK skills shortage

While UK unemployment has held steady, the number of people in work across the country has recorded its biggest fall since 2015.

Official figures, released this morning, reveal there were 32m people in work in the quarter to September 2017, down 14,000 from the previous quarter.

Meanwhile the UK’s unemployment rate held steady at 4.3%, while the number of people out of work but still jobseeking fell 59,000 to 1.42m.

Commenting on today’s figures, Mariano Mamertino, EMEA economist at the global job site Indeed, said Britain’s labour market might have just lost its trump card.

“The seemingly endless run of job creation has faltered and the employment rate has slipped. While unemployment remains at historically low levels, the labour market has for several months been looking increasingly dysfunctional.

“The problem is easy to identify but very hard to remedy – it’s offering workers an abundance of jobs but falling real wages. The hospitality and transport sectors are prime examples, and the ONS data reveals they created high numbers of jobs but weak wage growth.

He said that with employers reporting recruitment difficulties in many parts of the UK, it had become easier for jobseekers to find work than to secure significant pay rises, “meaning for many the focus is shifting to considering what good work looks like”.

For Lee Biggins, founder and managing director of CV-Library, the numbers paint an interesting picture: “Unemployment has fallen and a key driver of this is the fact that more people are choosing to stay put due to ongoing uncertainty around Brexit. 

“It’s clear that people aren’t taking risks on looking for new positions. EU citizens, in particular, are nervous about changing jobs, mainly because they hope for company loyalty if they’re negatively impacted by Brexit. 

“There are nearly 3m EU nationals working in the UK and they play an important part in boosting the nation’s economy.”

Doug Monro, co-founder of careers site Adzuna, said average weekly earnings for employees data – with an increase of 2.2% – shows the tide is turning on salaries. 

“In keeping with a low unemployment and steady inflation rate, there is festive cheer being spread among the labour market as pay rises have become a priority to boost productivity and staff morale. Christmas has come early for train drivers in particular, following reports they have agreed a 28% pay rise to end Southern Rail strikes. 

“We hope to see this ripple effect spread throughout the labour market as strong demand for fairer pay packages mounts, following Living Wage Week recently. With rising food prices still lagging behind salaries, household incomes will continue to be squeezed at present, but we hope to see the gap shrink in the coming year.”

David Clift, HR director, jobs site totaljobs, called the figures the latest “impressive” landmark for employment figures, which have remained stable throughout a year largely defined by uncertainty.

“Not since 1975 when Margaret Thatcher defeated Edward Heath for the leadership of the Conservative Party have unemployment figures been lower. 

“Data from totaljobs has found that a number of industries are continuing to perform strongly, with the healthcare seeing a 7% month on month increase in job postings.”

Also commenting, Recruitment & Employment Confederation CEO Kevin Green said employers already struggling to fill roles will be concerned to see that the number of people out of work has fallen yet again, reducing the available talent pool even further. 

“We have heard again and again from recruiters that they don’t have enough candidates to cope with the increasing number of vacancies.

“The number of people in employment is falling for the first time in two years. EU nationals are returning home and less are arriving, as they feel increasingly unwelcome here. We cannot afford to lose their skills and their contribution to the UK labour market. The government needs to make this country attractive to EU workers by ensuring their right to work here.”

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