Stuart Gentle Publisher at Onrec

Pay finally responds to record number of vacancies

Commenting on the latest ONS labour market statistics, Gerwyn Davies, senior labour market analyst for the CIPD, the professional body for HR and people development, comments:

“These latest UK labour market figures at last point toward the kind of jobs recovery we have been hoping for, with pay finally responding to labour shortages.  An increase in the number of people in full-time work, and a fall in the number of self-employed and part-time work, also suggests that employers are feeling more confident about hiring staff. This looks set to continue with the level of job vacancies reaching a new record level.

“However, the shrinking number of candidates will feed into increasing recruitment and retention challenges for many employers, particularly for employers in sectors that have relied on non-UK labour to fill roles.  This may partly explain why employment growth has slowed sharply in the last quarter. 

“While the increase in pay is welcome, it’s likely to be concentrated among new starters, key staff and recipients of the National Living Wage unless we see a boost in productivity growth. It’s only through improvements to productivity that we will see pay packets pick up more broadly so it’s essential that the ongoing productivity crisis is addressed in the Chancellor’s Autumn Budget.”