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4w ago

UK Labour Market Cools Sharply with Biggest Payroll Fall in Five Years

Worker availability has surged to pandemic highs after firms cut recruitment under rising cost pressures.

People walk through the financial district of Canary Wharf, London, Britain, 28 September, 2017. REUTERS/Afolabi Sotunde/File Photo
Both permanent and temporary staff availability have risen sharply
Image

Overview

  • A REC-KPMG survey shows the candidate supply index jumped to 63.3 in May, the highest reading since December 2020.
  • Tax data reveal payrolls fell by the most in five years in May, driving the unemployment rate up to 4.6% for the three months to April.
  • Permanent placements declined for an eighth straight month while temporary staff spending contracted at the slowest pace in six months.
  • Official figures indicate private-sector regular pay growth slowed to 5.1% in the three months to April but still exceeds the Bank of England’s 2% target.
  • Higher employer National Insurance contributions and a near-7% minimum wage rise have dampened hiring and could shape upcoming interest rate decisions.