UK ‘jobs crisis’ is underway, recruiters warn

London

London: The collapse in Britain’s labour market eased only slightly last month, according to a survey on Wednesday from the Recruitment and Employment Confederation (REC) industry body which warns that a “jobs crisis” is underway.

The figures from REC and accountants KPMG underscore the challenge facing finance minister Rishi Sunak ahead of an update to parliament,, on measures to support workers through the aftermath of the coronavirus pandemic.

REC said demand for staff continued to fall and at 31.9 in June – up from 19.1 a month before – it remained well below the 50 level that represents an increase in hiring.

“This is now a jobs crisis,” Neil Carberry, chief executive of the REC, said. “Rishi Sunak should use today’s Summer Statement to boost job creation, with a cut in National Insurance designed to retain jobs and boost hiring.” The supply of available workers soared in June by the largest amount in more than a decade, according to the survey, which is based on responses from around 400 recruitment companies.

Last month the Bank of England said there were some signs the economy had picked up by more than it had initially expected, but added that a rise in unemployment could be worse than it had thought.

On the latter front, the REC survey is unlikely to reassure BoE officials.

“While there are signs that the worst declines are behind us, today’s figures show that it will be a while yet before we see job placements growing month on month,” Carberry said.