Job vacancies in the UK have fallen below 900,000 for the first time since April 2021 as companies continue to slow down hiring plans. According to the UK Job Market Report by job search engine Adzuna, monthly job vacancies fell to 867,436 in January 2024. This represents both a year-on-year decline of -14.62 per cent, compared to January 2023, and a month-on-month drop of -6.64 per cent compared to December.
The contraction in vacancies means that competition for those posts available is increasing, up to 1.81 jobseekers per vacancy from 1.68 a month earlier. This is the highest competition rate since August 2021, the last time there was 1.81 people for every available role. Companies are also taking longer to make decisions about new team members, perhaps in response to the reduction in hiring budgets. Advertised vacancies are live on average for 36.6 days before they are filled, the longest time-to-fill since January 2023.
It’s not all negative, though. The monthly drop in vacancies between December 2023 and January 2024 wasn’t quite as sharp as the -6.95 per cent decline seen in the final months of last year. Early indications of February’s data show that there is likely to be stabilisation in advertised vacancies, with figures expected to rise between 0 per cent and +2 per cent next month, indicating that positive growth is around the corner.
Average advertised salaries also increased again in January, continuing the upward trajectory seen in December. National salaries were up +1.57 per cent monthly to £38,168 last month, +2.99 per cent higher than in January 2023, the highest they’ve been since March 2021. Regional salaries are picking up too, while London has experienced an increase in salaries for the first time since November 2022.
However, it’s becoming increasingly difficult to track average salaries in the UK, with over half of positions (51.5 per cent) advertised without salaries, in a continued blow to salary transparency campaigners.
Andrew Hunter, co-founder of Adzuna, said: “As we predicted last month, January 2024 has proven to be one of the most difficult starts to the year for job hunters in recent years with companies continuing to put hiring plans on ice. This will be disappointing for those hunting for work and only serves to drive up competition nationwide for available roles.
“However,” says Hunter, “it was positive to see in the most recent ONS data for October to December 2023 that unemployment has fallen again to 3.8 per cent and over 400,000 more people have been added to payrolls. Early data from February also suggests we may have turned a corner, with job vacancies predicted to rise next month. Those that are successful in gaining new employment could also enjoy a higher salary with average advertised salaries continuing to rise monthly and annually. If inflation continues to trend down and the cost of living crisis lessens, jobseekers can remain optimistic that the poor start to the year will quickly reverse.”
Tony Wilson, Director at Institute for Employment Studies, added: “Adzuna’s latest data paints a pretty mixed picture for the labour market at the start of the year. The seasonal fall in vacancies in December has continued through January, but very strong growth in salaries and some of the changes by sector suggest that this may be being driven as much by changes in demand as it is by any further weakening in the economy. In other words, it looks like we’re seeing fewer lower-paid jobs and more high paid jobs being advertised, which has pushed average salaries to pretty much their highest on record. With a bit more competition for jobs too, this is arguably good news overall, but it reiterates the need for us to do much better at helping people to fill these better-paid jobs if we want to grow our way out of this recession and bounce back strongly this year.”
