The jobs market remains buoyant, but a subdued economy, lingering uncertainty and persistent recruitment difficulties are beginning to weigh on firms’ hiring decisions, the latest figures from the Office for National Statistics show.
Commenting on the ONS labour market figures for January 2020, Suren Thiru, Head of Economics at the British Chambers of Commerce (BCC), said: “The jobs market remains strong in the face of a challenging economic backdrop, with firms continuing to hire in large numbers.
“However, falling job vacancies in Q4 compared to the previous quarter suggests that a subdued economy, lingering uncertainty and persistent recruitment difficulties are weighing on firms’ hiring decisions. If sustained, this could increasingly stifle jobs growth.
“The dip in regular pay growth will put further downward pressure on consumers’ spending power, despite weaker inflation. Achieving sustained wage increases will remain problematic unless the underlying issues that continue to limit pay settlements – poor productivity, rising employment costs and a sluggish economy – are tackled.
“More must be done to stimulate growth and productivity. With interest rates near to historical lows, there is little to be gained from further rate cuts. Instead the focus should be on using the upcoming budget to support firms looking to recruit and grow their business. Ministers should ease upfront business costs and comprehensively reform the Apprenticeship levy.”