17 May 2017
CBI/Pertemps Labour Market Update May 2017
Employment at record high, but pay growth continues to struggle
Employment growth continues to strengthen, with a record number of people now in work. At a time of economic and political uncertainty, this shows the resilience of businesses up and down the country, as they continue to employ more people and create new opportunities, with vacancies now at an all-time high. Unemployment also continues to fall with the jobless rate at its lowest in over 40 years.
Pay growth continues to struggle and has now gone negative, meaning the cost of living is outpacing wage growth. In addition, productivity weakened over Q1 2017, falling by 0.5% on the quarter. This followed modest quarterly growth in output per hour over 2016.
With both wage growth and productivity remaining tepid, it is imperative that there is a relentless policy focus on boosting the UK’s productivity. This is the only sustainable route to higher wages, and better living standards.