New ONS stats: CIPD claims fall in real wage growth highlights cracks in buoyant labour market
New statistics released on today’s ONS Labour Market Statistics show that a record number of people are in employment, however as highlighted by CIPD’s labour market advisor Gerwyn Davies, the results can be misleading in highlighting the economic strength of the UK.
In Mr Davies interview with HR news he relayed a number of stats that backed up his argument, including a fall in wage growth from 1.7% to 1.4% over the last three months. This shows that the quality of pay is gradually falling despite there being more people employed and with rising inflation in 2017 this could develop into a bigger issue. Companies are also being put under the additional strain of Brexit, which has meant severe adaptations to some businesses recruitment and labour force has been necessary.
Employers in the current economic climate are unlikely to be able to increase pay due to financial constraints. Mr Davies went on to say: “The figures also offer further evidence that Brexit has had a discernable impact on the allure of the UK as a place to live and work. The sharp growth in the number of non-UK nationals from the EU in work in the UK ground to a sudden halt in the second half of the year and has actually fallen in the last quarter. As a result, employers in sectors that employ relatively large numbers of EU nationals, which also account for a sizable proportion of vacancies, are likely to come under further recruitment pressures if, as we expect, this trend continues.”
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