The growth in new job ads in the UK job market last month showed signs of early resilience despite economic headwinds and increased employer pressure on increased taxes.
According to new data from the Recruitment and Employment Federation (REC), the number of new job ads increased by 0.3% in May to 726,084, a small increase, followed by the recruitment extension. However, the total number of active job postings fell 1.8% to 1.44 million, highlighting the slow pace of the market.
REC CEO Neil Carberry said the labor market was “more stuck than backwards”, noting that slow post growth marked a slight improvement in the second straight month rather than a deeper sign of contraction.
“Although tax headwinds and lower growth seem to be somewhat resilient,” Carberry said. “After a long slowdown in the job market, the second month of weak growth in new posts is more promising than the focus.”
The tentative recovery is in the context of rising employer costs. A recent hike on national employment contributions and a new government policy that will expand employee rights, including enhanced patient salaries, maternal protection and unfair discharge protection, prompting employers to review recruitment plans.
The government’s move to raise £25 billion in additional income through employment tax has exacerbated pressure on the labour market that has affected the impact of job openings for more than 15 months.
The latest data from HM income and customs shows that wage employees fell by 109,000 in May, the biggest drop since the pandemic on Covid-19-19. Unemployment in the recent quarter rose to a highest 4.6%, the highest since 2021, according to the National Bureau of Statistics.
Despite these warning signs, Kabury spoke cautiously optimistically.
“Although global growth is weaker than anyone wants, the UK is in a relatively good position to take advantage of what opportunities can be taken,” he said. “We have surpassed the interest rate peak, and the UK looks valuable compared to the US and has made progress in trade deals and has a stable legal and political situation in the coming years.”
Working data follows a series of mixed economic signals. Despite slowing GDP growth in April, there are tentative signs of boosting consumer confidence and gentle inflation, which could lead to lower interest rates later this year. However, rising business costs and ongoing uncertainty about global demand continue to be severe in the hiring outlook.
Recruiters say the coming months are about determining whether recent postal listings develop into sustained recovery or stalling under the weight of policy and macroeconomic pressures. For now, employers appear cautious but have no retreat – said experts, probably the best the market hopes for in the near term.
