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Worryingly, the number of vacancies in the UK economy has dropped to a five-year low.
The Office for National Statistics estimates that vacancies fell by 19,000 in March to May, to 707,000 – the lowest level since February to April 2021.
“Low levels of employer demand for labour unfortunately reflect a combination of government policies which have increased the cost and risk associated with hiring employees. This is choking off work opportunities for young people in particular, as jobs continue to decline in important youth employment sectors such as accommodation and food and retail.
“The cost of doing business has risen sharply in recent years, driving persistent weakness in hiring.
The unemployment rate ticked down to 4.9%. Payrolled employment rose after three consecutive monthly declines (it increased by a marginal 2000 workers). Average weekly earnings growth was higher than expected.
But the details still look dovish for the Bank of England. And the report is another reminder that the case for higher rates is far from the clear cut.
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