Mixed picture in the UK labour market as pay growth slows and vacancies fall

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Responding to the new Labour market overview January 2024 released by the Office for National Statistics, Ben Harrison, Director of the Work Foundation at Lancaster University, said:

“Today’s figures point to a mixed picture in the UK labour market with slowing pay growth and vacancies falling for the 18th consecutive quarter.

“Pay growth is on a downward trajectory from record highs late last year and is following the trend of falling inflation. While some workers may be seeing modest pay gains in their real pay, future gains may be reliant on inflation continuing to fall.

“While policy-makers at the Bank of England may be reassured by these figures as they assess whether to adjust interest rate levels, workers in insecure and low paid work are at the sharp end of the most significant reduction in real living standards since ONS records began as they try to make ends meet.

“Addressing this challenge will be a key battleground in the next General Election. Although 934,000 vacancies remain in the economy, policies which only focus on increasing benefit sanctions to push those out of work to take on new roles risk making matters worse. Instead, all political parties need to make clear how they will improve access to higher quality and more secure employment, while providing more tailored support for jobseekers with different needs.”

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