CBI/Pertemps Labour Market Update: April 2024

The latest ONS data covers the period from January to March 2024 and shows a largely unchanged labour market that remains tight overall but continues to slowly soften. UK employment is down on both the year and the quarter, while economic inactivity has slightly increased. The unemployment rate is above estimates of a year ago and up in the latest quarter. Vacancies continue to fall but are still above pre-pandemic levels.

The economic inactivity rate is higher than estimates a year ago and is up in the latest quarter. The increase is largely due to a rise in the number of students. Those inactive due to long-term sickness has increased slightly this quarter, following a steadily rising trend despite policy interventions aimed to reduce it. The number of vacancies continues to fall. This is the 21^st consecutive period in which vacancies have fallen but are still above pre-pandemic levels.

Growth in regular pay was 6.0% on the quarter to February 2024 – down from 6.1% in the previous period. In real terms, annual growth, real pay rose on the year by 1.9%.

There continue to be signs that the labour market is softening, the UK’s labour market looks increasingly two-speed. Unemployment is rising and inactivity persists. Meanwhile there remain a heightened number of jobs that employers can’t fill, causing pay to rise faster than compatible with significantly cutting interest rates. This highlights the importance of improving access to training, particularly reforming the failed apprenticeship levy.

Download the full labour market update, sponsored by Pertemps, below.