UK Pay growth (excluding bonuses), eased to 7.3% in the 3 months to October 2023 and the number of UK jobs vacancies fell by 45,000 between September and November.
It was the 17th month in a row that vacancies have fallen and the UK Office for National Statistics (ONS) says it is the longest period of decline on record.
However, the ONS did point out that overall UK jobs vacancies stand at 949,000 which is 148,000 above pre-pandemic levels.
UK workers’ earnings are also outpacing inflation.
The UK unemployment rate currently stands at 4.2%, with unemployment levels increasing by 206,000 this year which puts it at 77,000 above pre-pandemic levels.
However, the UK inactivity rate – those of working age who are neither working nor looking for a job – remains stubbornly high at 0.5% economically inactive. This contrasts with the UK having the lowest inactivity rate amongst OECD countries in the 20 years prior to lockdown.
Whilst employment rates bounced-back in most countries post-Covid, Britain’s did not and the main reason given is long-term sickness with 2.6m people – an increase of 476,000 since early 2020 – now economically inactive due to illness.
It is estimated that long-term sickness has added £15.7bn ($20.0bn), or 0.6% of GDP, to the UK Gov’s annual borrowing costs due to a combination of lost income tax revenue and increased social security spending.