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Vacancies fall as pay growth cools

The unemployment and economic inactivity rates remained stable

Vacancies in the UK have continued to fall while pay growth has slowed slightly, according to new data from the Office for National Statistics (ONS).

Vacancies fell by 58,000 between August and October 2023, falling for the 16th consecutive period. They fell in 16 of the 18 sectors measured. 

Pay excluding bonuses grew by 7.7% between July and September, slightly down on the previous periods, but is still among the highest annual growth rates since comparable records began in 2001. 

Annual growth in employees' average total pay (including bonuses) was 7.9%. This total annual growth rate is affected by the Civil Service one-off payments made in July and August 2023.

Inflation dropped to 4.6% from 6.7% in September. 

Read more: Labour shortage persists as employers turn to AI

Ben Keighley, founder of AI recruitment platform Socially Recruited said the jobs market is fairly stable.

He told HR magazine: “Compared to the political merry-go-round of the last 24 hours, the UK labour market has seen little change in its headline figures.

“Real pay is picking up, but with little movement in the employment and unemployment rates this is a market that seems more lethargic than resilient.”

Jack Kennedy, senior economist at the global hiring and matching platform Indeed, said that falling inflation rates are expected to ease cost of living pressures.

“Workers are belatedly seeing their wages rise in real terms. A further substantial fall in consumer price inflation is expected to have occurred in October, perhaps to below 5%, which will deliver a further boost to the value of pay packets.”

In September, 229,000 working days were lost due to labour disputes. The majority of the strikes were in the health and social work and education sectors.

ONS estimates suggest the unemployment rate is unchanged at 4.2%, while the employment rate dipped slightly to 75.7%.

The inactivity rate was stable at 20.9% and remains above pre-pandemic levels. 

Read more: Recruitment slows across Scotland

Keighley added: “With ongoing high levels of economic activity, businesses will be hoping the chancellor plans to bring more people back into the workforce as part of next week’s autumn statement.

“More immediately, companies that are under strength should pursue more targeted forms of recruitment to bring the best talent through their doors quickly and efficiently.”