Labour market recovery now looking solid, but will we now face skill shortages?
17 Dec 2014
Nigel Meager, Director of the Institute for Employment Studies, comments on today's ONS Labour Market Statistics:
‘The good run of employment figures has continued in the run up to Christmas, with all the main indicators recording improvements. The employment rate, at 73 per cent is now approaching the peak level recorded in 2004, while unemployment has fallen again to 1.96m, or 6 per cent of the active workforce.
‘It is interesting to note that the most recent growth has been mainly among full-time employees, and that both part-time employment and self-employment have fallen in the last few months. This suggests that some of the 'under-employment' which was a feature of the earlier stages of the economic recovery, may at last be being replaced by full-time jobs.
‘Vacancies have continued to rise strongly and are now close to their previous peak of 700,000 recorded in early 2008, confirming the strengthening demand for labour from employers. It is notable that the current level of vacancies co-exists with a much higher level of unemployment (nearly 400,000 higher) than in early 2008. This raises questions about how well the institutions of the labour market are operating to match the unemployed with employers' vacancies. Consistent with this are the anecdotal reports of skills shortages emerging from business organisations in several sectors.’
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 Nigel Meager
Nigel is a labour economist by training, and a well-established international expert on labour market and employment policy issues. He has worked at IES since 1984, following posts at the Universities of Bath and Glasgow. He has been Director of the Institute since 2004. He has a long and varied research track record covering the functioning of national, regional and local labour markets, unemployment, skill shortages, labour market flexibility, changing patterns of work and equal opportunity policies and practices.