Job vacancies on the slide amid fears of a hard Brexit
New job vacancy numbers are tumbling in the latest indication that the economy is wobbling in the face of no-deal Brexit fears.
While levels of employment remain at or near historical highs at 76.1%, there are signs of trouble ahead.
ONS deputy head of labour market statistics Matt Hughes said: “Employment continues to increase, with three quarters of this year’s growth being due to more women working.
“However, the number of vacancies has been falling for six months, with fewer now than there were this time last year.”
Last week it emerged that the UK economy shrunk by 0.2% between April and June raising the prospect of a recession post Brexit. That was the first fall in GDP in more than six years.
Tuesday's pay figures for the same period show wages rising at 3.9%, excluding bonuses. After inflation, that sees pay rising at a healthy 1.9%, though it has yet to return to its levels before the 2008 banking crisis.
Simon French, chief economist at Panmure Gordon, said: “The UK labour market continues to shrug off concerns over global growth and the potential for a disorderly Brexit.
“Jobs and wages growth both signal strong underlying demand amongst employers. This strengthens our view that the contraction in growth during the second quarter is unlikely to be repeated in the third.”
Productivity between April and June fell 0.6% compared with the same quarter last year. That was even worse than the 0.2% drop in the previous quarter from January to March.
French added: “Caution is merited. Labour market data is typically a lagging indicator. It tells us a lot about the past but relatively little about the future. The falling number of vacancies, together with another awful estimate of productivity, suggests that the Chancellor cannot be complacent.”
Tom Stevenson, investment director at Fidelity International, said: “The UK’s labour market is still the bright spot in the British economy. However, there is strong evidence to suggest a more balanced outlook than these numbers imply.”
