The Office for
National Statistics (ONS) has this morning released the latest set of UK labour
market data, mostly covering the three months June to August 2015.
It’s proving to be
a topsy turvey year for the UK jobs market. The first six months were characterized
by relatively slow employment growth, a fairly stable unemployment rate but
much better pay figures, overall suggesting an improvement in labour
productivity. However, between June and August the number of people in work
leapt by 140,000 to 31.12 million, reaching a record working age employment rate of 73.6%,
the unemployment rate fell from 5.6% to 5.4%, close to the pre-recession low, while
the pace of regular (i.e. underlying) pay growth eased back from 2.9% to 2.8%.
The explanation
for this apparent flip in behaviour is unclear, though it’s possible that
recruiters were cautious in the first half of the year because of political
uncertainty surrounding the General Election in May. What is clear is that
hiring picked up strongly from June onward with the number of employees rising
by 120,000 in the three months to August, full-timers accounting for more than
half (70,000) this increase. Interestingly, this outcome contrasts with the popular
narrative of recent months which explains the labour market trend at the start
of the year in terms of mounting recruitment difficulties and increased
competition for talent. Whatever the validity of this argument, employers don’t
seem to have had too much difficulty hiring staff between June and August, and
didn’t have to put more into regular pay packets to do so.
