UK companies are holding back on hiring or are not replacing workers who leave, sending job vacancies tumbling, official figures suggest.
The number of available jobs fell by 63,000 between March and May while the unemployment rate ticked higher.
The estimated number of available jobs fell to 736,000 over the three months to May.
Responding to the latest labour market data, published by the ONS this morning, Jane Gratton, Deputy Director Public Policy at the British Chambers of Commerce said: “The increase in employment costs for business appears to be starting to bite with today’s data showing a rise in unemployment.
“This year’s steep increases in national insurance and the national living wage have undoubtedly delivered a shock to businesses.
“Vacancies continue to fall which aligns with our research, showing that, due to increased employment costs, many firms are now freezing recruitment plans, while others are being forced to reduce headcount.
“At the same time, wage growth continues to outpace inflation, adding further cost pressures for firms already facing rising overheads. Employment costs and pervasive skills shortages are a massive challenge for business, presenting big risks to investment and growth.
“This week’s Comprehensive Spending Review is a golden opportunity to invest more in the skills system – with apprenticeship reform and local skills improvement plans critical to solving the problem.
“The £5bn cost associated with the employment rights bill poses a further threat to firms’ investment plans. Without further amendment, the legislation will add even more to employers’ costs.”
More details on the ONS data can be found here.
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