Vacancies surge as UK jobs market recovers

Job vacancies in the UK are at their highest level since the arrival of the Covid-19 pandemic last spring, according to official figures released on Tuesday.

The Office for National Statistics (ONS) also revealed a small fall in the unemployment rate to 4.8 per cent in the first quarter of the year. Economists had forecast the rate would hold steady at 4.9 per cent.UK business leaders welcomed the surge in vacancies, which reached 657,000 in April - an increase of 48,000 on the previous quarter - and was attributed to the easing of lockdown measures, which had encouraged firms to restart recruiting.Chancellor of the Exchequer Rishi Sunak said the latest ONS data illustrated the effectiveness of government action to protect jobs during the pandemic."While sadly not every job can be saved," he said, "nearly two million fewer people are now expected to be out of work than initially expected - showing our Plan for Jobs is working."Minister for Employment Mims Davies added: “A continued fall in unemployment, a further rise in vacancies, and growth in the employment rate is welcome news as we continue on our roadmap to recovery.“While there is more to do to make sure we support jobseekers over the coming months, these figures highlight the resilience of our jobs market and ability for employers to adapt – and through our Plan for Jobs we’re continuing to create new opportunities for people right across the country."Tej Parikh, chief economist at the Institute of Directors, said the figures showed the UK jobs market was "standing firm", though he feared that, as government job retention support began to unwind later in the year, there could be an increase in job losses.However, he said: "Hiring intentions have crept upward with the reopening of the economy and the vaccine rollout. As businesses attempt to re-scale during the recovery we are likely to see the number of vacancies mounting further."With an anticipated surge in consumer demand over the coming months, some firms may even be unable to find and onboard staff as quickly as they need to. "The government must also bolster its retraining initiatives as skills shortages are likely to grow, particularly in the digital space where the pandemic has ushered more firms into harnessing technology."Suren Thiru, head of economics at the British Chambers of Commerce, said the latest figures represented further confirmation that the UK jobs market had become more resilient to ongoing restrictions.“The rise in the number of job vacancies points to an encouraging upturn in demand for labour amid the gradual reopening of the economy and the strong vaccine rollout," he said.“UK unemployment remains on track to peak at a much lower level than in recent recessions. However, the squeeze on business cash flow from any marked delay to the planned full reopening of the economy may trigger renewed job losses, particularly when furlough becomes less generous over the summer.“The economic scarring caused by coronavirus may drive a two-track jobs market recovery, with strong demand for labour in sectors where activity rebounds quickly, but with young people now entering the workforce and those whose lost their job during the pandemic at particular risk of longer-term unemployment.”Matthew Percival, director of people and skills at the Confederation of British Industry (CBI), added: "Having the highest number of vacancies since the pandemic first hit shows the value of the roadmap for reopening the economy. However, businesses are starting to report vacancies they're struggling to fill so government support for skills and retraining is essential.“Businesses increasingly need to know what rules will be in place after June 21 to make their next reopening decisions. They are hoping to avoid any further bumps in the road and will be closely watching the trajectory of new variants and the conclusion of reviews into social distancing and Covid-status certificates.”

Read more news and views from David Sapsted.

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