The labour market statistics published by the Office for National Statistics (ONS), based on data from December 2017 – February 2018, show that the inactivity rate is the lowest on record, and the unemployment rate is the lowest since 1975. After being negative for a year, real pay growth (excluding bonuses) has rebounded to 0.2 per cent.
Recruitment & Employment Confederation (REC) director of policy Tom Hadley comments:
“After a year-long wait, it’s a relief to see pay growth at its highest since summer 2015 and inflation coming down. Our data shows employers have been increasing starting salaries to compete for talent for years but it hasn’t been translating into pay rises for the wider workforce. Today’s data is a sign that employers are beginning to think seriously about how to keep existing staff, who could otherwise be lured away by companies with better pay offers.
“Businesses are still worried about filling vacancies. The low inactivity and unemployment rates mean employers have to attract candidates away from competitors. We already know employers are working hard to reach out to underrepresented groups and to make hiring practices as inclusive as possible, but they still can’t find enough candidates. That’s why it’s essential the government allows businesses to continue to recruit EU workers post-Brexit, without extra cost, time and bureaucracy. We simply don’t have the number of people in this country to fill vacancies, and if the government doesn’t recognise this it will hinder further growth of our economy.”