All signs point to a cooling labour market as firms reduce hiring, says the CIPD

Responding to today’s ONS labour market figures, James Cockett, senior labour market economist for the CIPD, the professional body for HR and people development, comments:

“All of today’s data indicate that the labour market is cooling off, reducing recruitment pressures on employers. Outside of the pandemic, vacancies have fallen to their lowest level since 2015. On the flip side, it’s becoming a harder jobs market for candidates with the number of unemployed per vacancy, a sign of labour market slack, reaching levels last seen in early 2016, again outside of the pandemic.

“Pay growth is easing, but remains high by historic standards, as employers continue to grapple with rising costs based on the latest inflation data. The immediate effect of national insurance increases is less muted than previously thought, but the number of payrolled employees has fallen in all but one month since the changes were announced last October.

“Falls in employment have been particularly pronounced among young people. It’s vital that young people aren’t left behind and are given every opportunity to get into work at the outset of their working lives. We are calling on the government to introduce an apprenticeship guarantee for all 16 to 24-year-olds, to provide opportunities for young people to both learn and earn. This should be supported by enhanced financial incentives for small businesses, to help them tackle increased employment costs. Better training and employment opportunities for young people will help them start working life on the right foot while helping employers to build a pipeline of talent for the future.”