Labour market indicators

There are continued signs of a cooling labour market, said the Office for National Statistics (ONS), with vacancy numbers still falling and unemployment rising, “though earnings growth remains relatively strong”.

In March-May 2024, the estimated number of vacancies in the UK decreased by 12,000 on the quarter to 904,000. This is the 23rd consecutive period in which vacancies have decreased on the quarter, though they are still above pre-Covid-19 coronavirus pandemic levels.

The unemployment rate for people aged 16 and over was 4.4% in the February-April quarter, up from 4.3% and the highest level for three years.

And, currently, over a fifth of UK working-age adults (22.3%) are not actively looking for work.

Rebecca Florisson of the Work Foundation at Lancaster University said the data shows “there will be no time for complacency for the next government as the UK has a smaller workforce that is poorer and sicker than in 2019.

“There are now a record 2.83 million people who are economically inactive due to long-term sickness — 702,000 higher than in January-March 2020.”

Florisson added that the UK “continues to be an international outlier with participation rates well below pre-Covid levels and this trend shows no sign of abating”.