The number of job vacancies in the UK has fallen to 707,000, the lowest level since February to April 2021, according to the Office for National Statistics (ONS). The figures suggest a softening labour market, with businesses becoming more cautious about taking on new staff.
Liz McKeown, the ONS’s director of economic statistics, said the further drop in job vacancies indicated that “firms are becoming more cautious about taking on new staff.” The professional services sector saw the largest decline, but retail and hospitality also recorded significant falls.
“UK job vacancies fell to 707,000, the lowest since 2021, as firms cut hiring.”
Data from HMRC shows that the number of new recruits – known as ‘inflows’ – was just under 540,000 in April, the lowest monthly figure since March 2021 and a five-year low. Despite the drop in hiring, the unemployment rate fell slightly to 4.9% in the three months to April, down from 5% in the three months to March.
Regular pay – excluding bonuses – grew at an annual rate of 3.4% in the three months to April, unchanged from the previous period and still slightly outpacing inflation. However, McKeown noted that regular wage growth in the private sector was rising at its lowest rate in five and a half years.
Jamie Younger, who opened The Victory pub in south London last month, said rises to the minimum wage and national insurance contributions had “made life very difficult.” He explained that many pubs and restaurants were now only hiring people with several years’ experience “rather than trying to support a younger generation and get them into their first job.” Cutting VAT, a measure called for by hospitality groups, would help ease the pressure and “give us the opportunity to train young people,” he added. “There is a benefit of employing someone in their first job because you get to train them… and mould that person. But with the financial restrictions it’s becoming harder and harder every day.”
Sasha Swann, a student working in the pub’s kitchen over the summer, said she had been thrown in “at the deep end… but it’s made me learn so much.” She described herself as “extremely fearful” about entering the world of work after university. “It’s all up in the air whether we are going to get those jobs,” she said.
The ONS described the labour market as “broadly stable,” but the five-year low in vacancies, combined with declining new hires and slowing private sector wage growth, points to increasing caution among employers.