Strong pay growth driven by ongoing labour shortages and National Living Wage changes

Findings from the recently published ONS have revealed that despite employer uncertainties, the jobs market remains resilient with strong pay growth.

Commenting on the findings, Neil Carberry, Chief Executive of REC, said, “The jobs market remains reassuringly resilient in the face of economic headwinds and sluggish growth.

“While employers are feeling uncertain about the future they still need to hire, in part because of ongoing labour shortages. These shortages are combining with high inflation and changes to the National Living Wage to drive very strong pay growth.

“For jobseekers, this should be a welcome picture – there are opportunities out there to get into work or move to raise wages.”

Neil added, “For companies, there is little sign of a change from the need to really focus on their talent strategy – recruiters are here to help with this, including changing the mix of skills as firms invest more in technology.

“For policymakers, this picture of shortages should be a concern, as it is likely to constrain a recovery in growth.

“An industrial strategy that includes workforce thinking is essential to tackling economic inactivity, developing new skills and a pragmatic approach to immigration.”

To find out more about contracting please contact Jaime on 01206 591 000 or email jaime.thorpe@contractorumbrella.com.