BBC NewsBorrowing was £17.4bn last month, the second highest October figure since monthly records began in 1993.
The latest ONS labour market figures show a general recovery, with employment increasing slightly, and unemployment decreasing. Average total pay also increased, growing 4.8% between November 2021 and January 2022.
Joanne Frew, who is Head of Employment at the global legal business DWF, explains how the labour market is holding on.
“The latest ONS labour market figures show a continued recovery of the market. The highlights for the period between November 2021 and January 2022 show an estimated UK employment rate of 75.6%, 0.1% higher than the previous quarter. The UK unemployment rate was estimated at 3.9%, 0.2% lower than the previous quarter and significantly returning to pre-pandemic levels. The figures represent a relatively challenging period in the journey of the pandemic with the Coronavirus Job Retention Scheme closed and the Omicron variant leading to tighter restrictions. The labour market has yet again demonstrated its resilience,” Frew says.
As we have seen with the pandemic, world events have a massive effect on the labour market. Thankfully, Covid-19 vaccinations have proved effective even in times of increased case numbers. Frew explains how other world events, such the war in Ukraine, could also have an effect even if the downturn caused by the pandemic is mostly over.
“Although there are some peaks in the number of people contracting Covid-19 across the UK, hospital number remain relatively low. As far as the impact of Covid is concerned, as we adapt to the next phase of living with Covid we would expect the labour market to remain stable in the short to medium term,” Frew says, “However, the war in Ukraine and subsequent potential increases in costs of material may yet have an impact on the UK labour market and there could be more challenging times ahead.”
While the labour market continues to show signs of recovery, job vacancies have still risen to record heights, reaching 1,318,000 in February of 2022. Frew explains how employers are facing this challenge.
“For now, many employers are taking the opportunity to consider the next step out of the pandemic carefully as restrictions are eased and there is a move to personal responsibility. A recent survey from the Chartered Management Institute found that 84% of firms had adopted hybrid working. With retention and recruitment difficulties continuing, employers are having to think of new and innovative ways to attract the best talent, as well as the more traditional route of increased pay.”
For now, the recovery continues, and the upward trend shows no sign of stopping. The impact of the pandemic is slowly coming to a halt, but as we have seen, new challenges can often be unpredictable.
