Monday 12 August 2019 1:44 am

Outlook for employment falls as UK teeters on brink of recession

The outlook for employment in the UK has fallen for the third consecutive growth following half a decade of sustained group, according to research published today.

An employment index combining forward-looking employment intentions and the proportion of part-time or temporary workers in the UK jobs market from audit firm BDO, fell to 112.76 points in July - the lowest level since May last year.

The number of job vacancies in the UK has also fallen four per cent since the start of the year as the UK teeters on the brink of recession.

Businesses also face the pressure of increasing wage growth on businesses, with average weekly earnings increasing 3.4 per cent in the three months to May - 0.2 percentage points higher than the three months to April.


This growth set against the backdrop of the negative economic outlook has meant companies are looking to save costs by cutting hiring, causing the jobs market to plateau.

Peter Hemington, partner at BDO, said: This could be the beginning of the end of the strong employment market in the UK. It has remained one of the more resilient pillars of the UK economy, even in the face of Brexit, but the glory years appear to be over.”

Meanwhile, a report published today by the Chartered Institute of Personnel and Development and the Adecco Group shows that the supply of labour is constrained compared with previous years, particularly for low-skill vacancies.

Where employers last filled a low-skilled vacancy they received a media number of 16 applicants for that role. This compares with 20 applicants in summer 2018 and 24 applicants in summer 2017.

In contrast, the supply of medium and high-skilled applicants has held up relatively well, which can be partly attributed to the sharp increase of 123,000 non-EU citizens in the UK workforce between the first quarter of 2018 and the first quarter of 2019. 

Gerwyn Davies, senior labour market adviser for the CIPD, said: “The alarm bell is sounding for employers trying to fill low-skill roles, many of whom are still in wait-and-see mode. It’s essential that those employers are prepared for reduced numbers of candidates and further restrictions to low-skill labour planned from 2021 with a workforce plan.” 

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