Brexit fears fail to stem UK jobs growth

The UK jobs scene is continuing to shrug off Brexit uncertainty with official figures showing that both the number in work – 32.75 million – and the employment rate of 76.1 per cent have reached record highs.

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The Office for National Statistics (ONS) said that, over the past year, employment had increased by 357,000, due entirely to an increase in full-time jobs. Unemployment, meanwhile, remained at a 44-year low with a rate of 3.8 per cent.In the three months to the end of May, the number of job vacancies stood at 837,000, 11,000 more than a year earlier but 12,000 fewer than for the three months to February.Including bonuses, average weekly earnings were estimated to have increased by 3.1 per cent over the year, before adjusting for inflation, and by 1.2 per cent after taking inflation into account.

Employment rate for women highest on record

The data also showed that the employment rate for women stood at 72 per cent, the highest on record.Matt Hughes, deputy head of labour market statistics at the ONS, said, "With employment growth among women coming from full-timers, the overall gap between men and women in hours worked is now the lowest ever – women now average about three-quarters of men's weekly hours, compared with around two-thirds 25 years ago."Jon Boys, labour market economist at the Chartered Institute of Personnel and Development, commented, “Encouragingly all the employment growth has come from full-time jobs, suggesting that employers are shrugging off Brexit-related uncertainty, at least in relation to their hiring decisions. In tight labour market conditions workers are in a stronger position to demand the terms of their contracts, with many pushing for full-time, permanent roles. 

Strong jobs growth in skilled sectors 

“There was also strong jobs growth in some of the highest and most skilled sectors, including professional and scientific occupations, as well as IT. In further positive news, there is evidence the labour market is becoming more inclusive, with an increase in the number of women and older workers finding work. “Wage growth continues to outstrip inflation delivering more money to workers’ pockets. However, real pay – excluding bonuses – is still £5.70 a week lower than the pre-recession high."Employment Minister Alok Sharma welcomed the ONS report, “Once again we see more people in work than ever before – 3.7 million more since 2010: a testament to the government’s support for employers and jobseekers on a day where we also mark that two million claimants are now being supported through Universal Credit," he said.“With wage growth increasing pace on last month, outstripping inflation for the 15th month in a row, and record high female employment – the government’s focus on pro-business policies and balanced economic management is delivering opportunity for all.”However, Tej Parikh, chief economist at the Institute of Directors, warned that the data might indicate job creation was softening.“The buoyant labour market is still going strong for the UK economy, even as it weathers widespread political uncertainty," he said.“Businesses’ avid appetite for new hires has drawn many out of unemployment and inactivity into work, which has provided uplift to household incomes. With vacancies outpacing the number of people available to fill them, competition has pushed up wages in new positions, giving a boost to job switchers and starters.

Employment boom cannot last

“However, the employment boom cannot last forever, and is certainly showing signs of softening. Business leaders are finding it harder to recruit as the supply of talent shrinks, and wage growth has failed to sustain the heights we saw earlier this year."To build on the existing strengths of the jobs market, the government will need to step up on its training agenda in order to support businesses to overcome skills shortages and drive up productivity and pay packets.”

Public services facing ‘big gaps’ 

Publication of the employment figures coincided with a survey from recruitment company Manpower showing that public services were facing "big gaps" in recruitment because of the number of skilled EU27 workers leaving the UK because of Brexit.Mark Cahill, Manpower Group’s UK managing director, said, "Looking at the public sector, it's not just the NHS that is facing huge shortages. We have seen the government launch a campaign to fill 110,000 vacancies in the adult social care sector, while the Department for Environment, Food and Rural Affairs is now the largest it has been in the last decade as it has recruited to prepare for Brexit."We forecast that civil service hiring is set to continue apace through the summer. There is an intention by government to hire more people, but the level of skills just aren’t available.” Manpower called on the government to support free movement of people after the UK leaves the EU. Mr Cahill said the government should allow, “people even post-Brexit to come to the UK with skills that we don’t have here today so that we can get the jobs done”.Subscribe to Relocate Extra, our monthly newsletter, to get all the latest international assignments and global mobility news.Relocate’s new Global Mobility Toolkit provides free information, practical advice and support for HR, global mobility managers and global teams operating overseas.Global Mobility Toolkit download factsheets resource centreAccess hundreds of global services and suppliers in our Online DirectoryClick to get to the Relocate Global Online Directory