The number of people looking for jobs has risen at its fastest pace since 2020, indicating growing weakness in the employment market.
A combination of increased redundancies and fewer job openings has led to a surge in job-seekers, according to a closely watched survey by KPMG and the Recruitment and Employment Confederation (REC).
This marks the 15th consecutive month in which “staff availability” has risen, with the current increase being the highest since December 2020.
Recent months have seen a climb in unemployment rates and a cooling in wage growth, raising the prospect of the Bank of England cutting interest rates this summer. Recruiters have noted that high interest rates have contributed to a slowdown in the labour market.
The KPMG and REC Report on Jobs revealed a decline in both the number of employees securing new jobs and the number of vacancies, although the rate of decline has slowed compared to previous months.
The report’s seasonally adjusted staff availability index, which measures the number of people looking for jobs, reached 62.2 in May, up from 60.4 in April. This index has been on the rise since last March.
High unemployment and reduced demand for staff
The increase in job-seekers was attributed to “a mixture of redundancies, higher unemployment, and reduced demand for staff,” according to the report.
The number of people finding permanent jobs through recruiters has now decreased for 20 consecutive months. While demand for staff in the form of vacancies also fell, the decline was described as “fractional.”
Jon Holt, chief executive of KPMG in the UK, commented on the figures, highlighting the “complexities in the current labour market.”
He stated, “The big picture is that unemployment is historically low with the ease of filling vacancies back to pre-pandemic levels. Taken together with today’s data and expected interest rate cuts, inflation easing, and increased consumer confidence over the summer, we will hopefully move towards a better economic outlook for the second half of 2024.”
Official data from last month indicated that the unemployment rate rose to 4.3 percent between January and March, up from 3.8 percent between October and December.
Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.
