Job Vacancies in Britain Hit Record High as Unemployment Falls

“Rising wage pressures fit with the broader story of rising inflation across the economy,” Kallum Pickering, an economist at Berenberg, wrote in a note. This strengthens the case for the Bank of England to raise interest rates next year, he added.

Overall, the British labor market is recovering strongly from the pandemic. The number of people on payrolls rose by 182,000 in July, up 0.6 percent from June. Compared with February 2020, the number of payrolled employees is down by 201,000. At its worst, in November, there were nearly 969,000 fewer employees than before the pandemic.

In the second quarter, the unemployment rate slipped to 4.7 percent from 4.9 percent in the previous quarter. There was a record flow of about 300,000 people from unemployment into employment. There was also a decrease in the economic inactivity rate, as more people were classified as unemployed because they have resumed hunting for a job.

By the end of the second quarter, about two million people were still on furlough in Britain, but that program will end next month. Even as vacancies remain high, policymakers and economists are watching closely to see if there will be a notable rise in the unemployment rate after the furlough program ends or if those workers are able to find jobs.

The Bank of England is not forecasting another increase in the unemployment rate this year and but expects it to be about 4.25 percent in 2023. It was at 3.8 percent before the pandemic.

Article source: https://www.nytimes.com/2021/08/17/business/job-vacancies-unemployment-britain.html