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Latest ONS figures reveal UK’s lowest unemployment rate since 1975

May 25, 2017  /   No Comments

Latest ONS figures reveal UK’s lowest unemployment rate since 1975The latest UK labour market figures from the Office for National Statistics show that unemployment fell to 4.6% in the three months to March, the lowest level since 1975.

Estimates for the period between October to December 2016 and January to March 2017 show that the number of people in work increased, the number of unemployed people fell, and the number of people aged from 16 to 64 not working and not seeking or available to work (economically inactive) also fell. There were 1.54 million unemployed people (people not in work but seeking and available to work), 53,000 fewer than for October to December 2016 and 152,000 fewer than for a year earlier.

Commenting on the findings, The Freelancer & Contractor Services Association (FCSA)’s Chief Executive Julia Kermode said: “It is interesting to see that this quarter’s increase in total workforce numbers was almost entirely driven by permanent employment, which indicates that businesses confidence is growing as firms add more people to their headcount. Self-employment decreased slightly last quarter, but year on year the 381k increase in the UK workforce includes +82k self-employed, which is 21.5% of the increase in people working.

“However, we are also seeing some early indications of difficulties ahead, with CIPD’s survey results issued yesterday suggesting that 19% of organisations expect to announce a pay freeze with wages set to rise by just 1% in the year ahead. If that is the case then businesses are likely to become reluctant to add more permanent roles and will turn to freelancers to find short-term replacements to fill the gap which will be good news for the flexible workforce. Freelancers can offer businesses professional skilled talent on an ‘as needs’ basis without incurring the costs that come with hiring full time employees.”

However, falling candidate availability may go some way to explain the figures, as the Recruitment & Employment Confederation (REC)’s Chief Executive Kevin Green explains: “This is more evidence of the growing skills crisis in the UK, and backs up the REC’s data showing falling candidate availability.

“With real wages now falling, the main way to secure a pay rise is to move jobs. Recruiters are reporting that starting salaries continue to increase as employers offer pay incentives to attract the talent they need. At the same time, signs that the economy is creaking could be putting some people off from moving jobs and taking the associated risks. 

“Whichever party forms a government after 8 June will have to get to grips with multiple challenges to keep the jobs market on course. Addressing the skills shortage needs to be a priority, because businesses will suffer if they are unable to fill vacancies. We need serious investment in skills for UK jobseekers, as well as an approach to immigration which is agile and pragmatic enough to meet labour market needs.”

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