Latest labour market trends: what they mean for your business
The latest labour market report from the Office for National Statistics shows a few important trends that might affect your business.
First off, it looks like the job market is starting to cool down. It’s estimated that there are fewer job openings now, which means businesses aren't hiring as much as before. On top of that, the unemployment rate has gone up to 4.4%, which is higher than it was last year.
When it comes to employment, the data is a bit mixed. Recent surveys and tax data show a slight drop in the number of jobs. However, the overall picture since December 2023 is more positive, with an increase of 431,000 jobs. So, while there have been some recent declines, the long-term trend still shows growth.
Interestingly, more people are not working or actively looking for work. The rate of people who are inactive in the job market has risen to 22.3%. This could mean more people are staying out of the workforce for various reasons.
On a brighter note for employees, though not necessarily for businesses, wages are on the rise. Regular earnings have grown by 6.0%. After adjusting for inflation, people are still earning more, which is good news for employees and may assist morale in the workplace.
However, there’s also been an increase, both since last month and since last year, in the number of people claiming unemployment benefits. This has now reached 1.629 million.
So, what does all this mean for your business?
-You might want to reconsider your hiring plans for now. With fewer job openings and more people out of work, focusing on retaining and training your current employees could be a smart move.
-It’s also important to plan for higher wages, as pay rates are going up.
-Offering flexible work options or training programs could help attract people who aren't currently working.
Looking ahead, although there are some short-term changes, the long-term trend shows that job growth is slowing down. As ever, it’s essential to focus on sustainable business practices and long-term planning to navigate these changes in the job market.
See:
https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/uklabourmarket/june2024
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