‘The latest employment statistics from ONS cover the three month period up to the end of December 2017, and on the face of it reflect a continuation of the remarkably robust pattern of the last few years.
It is interesting to note that the vast majority of the recent growth in employment consists of those in full-time employment. Self-employment, which has been a key component of jobs growth in recent years, appears to have gone off the boil, the numbers of self-employed are down again, and the growth in part-time and temporary work has also gone into reverse. These changes may be early signs that the sustained tight labour market is starting to generate more stable, higher quality jobs than in previous years. Further evidence of the tightness of the labour market is evident in the fact that unfilled vacancies are also at record levels (up to 823,000 in the latest quarter), but despite this, pay growth remains very muted and below inflation. The big unanswered question is, how long will the lid remain on pay growth, given the pressures building up in the labour market?
More generally, overall employment levels are up and the employment rate remains at a record high level (just over 75 per cent), although the rate of growth is somewhat more muted than we have become used to. There has been a slight increase in unemployment but the rate of unemployment at 4.4% remains very low in historical terms. Importantly, the slight upturn in unemployment has not been at the expense of people in work, but stems from a reduction in the numbers of inactive people, more of whom appear to be joining what is now a very tight labour market.’
