The Office for National Statistics (ONS) reported a further decline in job vacancies, with 7,000 fewer openings in the three months to June, bringing the total to 712,000. This follows a 19,000 drop in the previous quarter, indicating a sustained slowdown in hiring.
Small Businesses Drive Vacancy Decline
The decrease was primarily driven by smaller businesses, which saw vacancies fall by 8,000. This was partially offset by an increase in medium-sized firms. According to the ONS, labour and operating costs were cited by small businesses as key factors in not taking on new staff.
Liz McKeown, ONS director of economic statistics, said: “The latest data show a relatively steady labour market picture overall, though some measures continue to suggest softening. Vacancies fell again over the quarter, but by less than in recent periods. The latest decrease was driven mainly by smaller businesses, where labour and operating costs were cited as factors in not taking on new staff.”
Private Sector Wage Growth Below 3%
Private sector wage growth dropped below 3% for the first time since 2020, reflecting easing pressure on employers to raise pay. However, overall regular wage growth remained unchanged at 3.4% in the quarter to May. When adjusted for inflation using the Consumer Prices Index, earnings rose by 0.4%.
Unemployment Rate Steady at 4.9%
Britain’s overall unemployment rate held steady at 4.9% in the three months to May, indicating a relatively stable labour market despite the softening in vacancies and wage growth.
