Finance

UK job vacancies shoot pass 1m for first time

UK employment updates

More than a million jobs stood open in the UK in the three months to August thanks to a hiring frenzy, while payrolled employment last month rose by almost quarter of a million as more people rejoined the labour market.

The Office for National Statistics said unemployment fell to 4.6 per cent in the three months to July, meeting analysts’ expectations and sliding from 4.7 per cent a month earlier. The employment rate rose to 75.2 per cent. More timely data from HM Revenue & Customs showed that the jobs boom continued in August, with payroll employment up by 241,000 on the month to match pre-pandemic levels.

The number of job vacancies were at 1.034m in the three months to August, rising above 1m for the first time on record. More people entered the labour market as opportunities became available: economic inactivity fell, partly because of a sharp rise in the number of students working or job hunting, while fewer people said they were looking after family.

The ONS said young people — the hardest hit at the start of the pandemic — had seen a strong increase in employment, with joblessness and inactivity falling.

The upbeat figures will support the government’s assertion that the jobs market has recovered to a point where it can withdraw wage subsidies and other emergency income support.

“The economy is now well-prepared for the end of furlough,” said Kitty Ussher, chief economist at the Institute of Directors, adding: “The challenge for government is to put its money where its mouth is and demonstrate in practice how we can fill vacancies by investing in our domestic workforce in a post-Brexit world.”

Rishi Sunak, chancellor, said the statistics “show that our plan for jobs is working”, adding that the government’s focus “remains on creating opportunities and supporting people’s jobs”.

However, some economists warn that unemployment could still rise again over the next few months as the furlough scheme ends — with many small businesses still using it to support jobs that may no longer be viable, and older workers who had been furloughed for long periods especially vulnerable.

Yael Selfin, economist at KPMG, said the labour market could remain “choppy”, with vacancies taking time to fill due to skills shortages and the lower numbers of overseas workers. 

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