Labour market continues to tighten with early signs of supply constraints re-emerging
18 Feb 2015
Jim Hillage, IES Director of Research, comments on today's ONS Labour Market Statistics:
‘The labour market figures published today show a further 100,000 additional people employed, increasing the employment rate to a record-equalling 73.2 per cent. There is now a higher proportion of people in work than at any time since records began in 1971. The demand for labour is therefore still strong with full-time employment up, and signs of under-employment falling, with falls in both involuntary part-time employment and self-employment.
‘However as the labour market appears to normalise, there are signs that labour supply is failing to keep pace with the rising demand.
‘Unfilled vacancies have risen strongly, and as unemployment falls there are now only an average of 2.6 people chasing each available job, compared with over five two years ago. The strong demand for labour can also be seen in the rise in average earnings which are now increasing far faster than prices. Both these are portents of increasing skill shortages which could hamper economic growth in the months ahead.’
The Institute for Employment Studies is the UK’s leading independent, not-for-profit centre for research and evidence-based consultancy on employment, the labour market, and HR policy and practice.
About Jim Hillage
Jim Hillage leads the Institute for Employment Studies’ work on UK public employment policy. He draws on over 30 years’ experience of researching into labour market and employment issues from an individual and an employer perspective, and evaluating the direct and indirect effect and impact of a range of policy interventions on employers, individuals and intermediaries.
View Jim Hillage 's full profile: www.employment-studies.co.uk/staff/jim-hillage
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