The number of people looking for work in the UK has increased for the 41st consecutive month, while available vacancies have fallen for 22 months in a row, highlighting growing pressure on the jobs market.
New data from KPMG and the Recruitment and Employment Confederation (REC) shows the pool of job seekers has continued to grow for nearly three and a half years, as businesses remain cautious about hiring. The unemployment rate currently stands at 4.9 per cent, with economists forecasting it could rise to around 5.3 per cent this year.
Against this backdrop, industry leaders are calling on the Government to reduce the costs and red tape surrounding employment to encourage businesses to hire, particularly young people entering the workforce.
While permanent placements stabilised, temporary placements increased for a fourth consecutive month, suggesting some employers may be beginning to revive hiring plans. Starting salaries also rose at their fastest pace in six months.
“Underemployment is becoming a growing concern for the UK economy,” commented Sheila Flavell, CBE, COO of FDM Group. “We’re seeing highly capable graduates entering roles that don’t fully utilise their skills, which ultimately slows productivity and limits long-term growth. This reveals a misalignment between academic curriculum and what employers actually need.”
Maxine Bligh, REC’s chief membership and innovation officer, said the rise in vacancies for temporary jobs, the first in two years, showed that employers were set to “revive hiring plans”.
She called on the government to build “momentum in hiring” and prioritise the jobs market as ministers begin to layout policy in the coming months.
“If the government is serious about getting more young people their first vital opportunities of work they must think carefully about the balance of their ‘make work pay’ agenda by easing mounting costs and red tape around employment,” the industry chief said.
With youth employment a key priority for Andy Burnham, the latest figures underline the challenge facing policymakers as the number of people seeking work continues to rise while opportunities decline.
