REC response to ONS labour market figures, April 2023

The ONS has published its latest labour market update this morning. Commenting on the statistics, Neil Carberry, Chief Executive of REC, said:

“The jobs market remains buoyant with activity levels well ahead of pre-pandemic, even if things are not as fizzy as they were in 2022.

“The ONS rightly attributes slower hiring to employers feeling more risk-averse because of the sluggish economy. To counteract this, firms are tapping into the UK’s pool of high-quality temporary workers to help them grow.

“Pay is rising strongly, in response to both price rises and hiring challenges, but not at a rate that will cause further inflation.

“Though falling, both vacancies and economic inactivity remain well in advance of pre-pandemic levels. This means the defining feature of our labour market right now is still labour shortage, with total hours worked still below their pre-pandemic level. Addressing this shortage will be vital to getting the economy growing.

“The recent Budget was right to put the challenge of labour availability at the heart of the UK growth story. While moves on childcare were helpful, there is a lot more still to do, especially around skills reform and supporting those who want to work in more flexible ways, including contracting and agency work.”

Ends

Notes to editors:

Overcoming shortages - How to create a sustainable labour market – July 2022. In this report, we show exactly how much damage could be done if we don’t step up. With a 10% surge in demand for staff across the economy, and the labour market restricted by shortages, we could see a 1.2% fall in expected GDP and productivity by 2027 – costing the economy anywhere between £30 billion and £39 billion every year. This figure is just short of the entire current defence budget, or two whole Elizabeth Lines.

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