“Today’s figures capture a labour market that has slowed with the economy, though activity levels overall remain relatively robust with vacancies still high. With business surveys predicting demand for both permanent and temporary workers to pick up in the near term, this looks like something of a soft landing.
“While overall pay growth remains high, there are signs of softening in the underlying data that we would expect to increase in pace as large 2023 pay awards continue to fall out of the data over the next couple of months. Sectors affected by the latest National Living Wage increase will not see this, however, and this is likely for be a significant challenge. Employers in these sectors have faced a long tough period since the pandemic in terms of wage and goods price inflation, the cost of Covid loan repayments, labour shortages and price pressure from customers.
“Getting the labour market right matters to driving sustainable growth. That’s why The REC has called for a new approach to workforce from Government, based on strong evidence. Tackling barriers on skills, support infrastructure like childcare and transport, regulation and tax. It is time for politicians to really listen to business on what works to tackle inactivity and drive growth. Put the economy first, so it can support lower taxes and better public service funding.”
