The UK labour market continued to cool over the summer, with job vacancies falling 5.8% to 718,000 between May and July, according to the Office for National Statistics (ONS).
It marks the 37th consecutive monthly decline in vacancies, taking openings well below pre-pandemic levels. The ONS said almost every sector saw a drop, with some employers opting not to recruit or replace departing staff.
Annual pay growth, including bonuses, also slowed – falling from 5% to 4.6% over the period – as companies sought to rein in costs.
Liz McKeown, ONS director of economic statistics, said the figures “point to a continued cooling of the labour market.” The unemployment rate remained unchanged at 4.7% in the three months to June.
Sheila Flavell CBE, chief operating officer at FDM Group, said the downturn reinforced the need to invest in workforce skills to maintain competitiveness: “The pace of technological change means that demand for certain skills, particularly in artificial intelligence, remains strong. This is a moment for businesses and policymakers to prioritise skills development… By focusing on experiential learning, adaptability to tech evolution and inclusion at all levels, we can safeguard both economic growth and individual career prospects.”
The Chartered Institute of Personnel and Development (CIPD) has warned that young people are being hardest hit, with hiring intentions among businesses at record lows.
Meanwhile, the latest labour market survey from KPMG and the Recruitment and Employment Confederation (REC)found a sharp drop in both permanent and temporary roles in July – the steepest since April – coinciding with a rise in people returning to work and more graduates seeking employment.
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UK job vacancies fall 5.8% to 718,000 as labour market slowdown deepens