A rise in inflation is being feared in the United Kingdom as job vacancies in the country surged for five months consecutively, signaling wage growth and tightness in the labour market, Bloomberg reported.
The data given in Adzuna, an employment website, cited in the report, suggested that 1.06 million vacancies across the UK were listed on the job search site in the month of June, which was 0.78% more than the previous month but lower than the same month in 2022.
As per the data based on every job promotion in the Kingdom across 1,000 sources, the advertised salaries witnessed a 3.6% rise compared to the last year, while the number of days to fill the job openings dropped to a record low.
This showed that employers are still having a hard time hiring the required staff. A likelihood of biding up the wages was also observed which will consequently add to the risks of an inflationary spiral.
As per the report, the Bank of England (BOE) is closely monitoring UK’s job market to have an estimate of how much it further needs to jack up the interest rates to evade a wage-price spiral.
“Despite the recent small rises in unemployment, the labor market is still incredibly tight,” Institute of Employment Studies official Tony Wilson said in the Adzuna report.
A recent report stated that UK saw a 4% hike in national unemployment.
“This poses risks for future inflation. It’s also a reminder that the economy is still creating a lot of opportunities and many of them well paid,” Wilson added.
The numbers from Adzuna stand in stark contrast to those from Reed Recruitment, which revealed that in the three months leading up to May, vacancies in England decreased by roughly a third from their post-pandemic high.
Earlier this month, Chairman James Reed stated that chances of the UK entering a recession have increased due to a “significant” fall in listings over the previous year.
However, Adzuna co-founder seemed optimistic about the outlook for the economy.
“If hiring trends continue to improve, we could be back at the record hiring levels we saw in 2022 by the end of the year.” Hunter said in a statement. “Competition is high amongst employers looking to snap up the best candidates.”
Over the same time period, wage growth surged to 7.3% from a year earlier, beyond the level of comfort, BOE claims is consistent with its 2% inflation target.
London remained the only part of the country without a bump in pay. The biggest annual salary increase was recorded in property, a sector that saw a decline in vacancies year on year.