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Britain’s hiring growth & signs of economic slowdown

Britain's unemployment rate fell to 3.6%, the lowest level since 1974

According to a survey, British recruiters experienced the slowest rise in hiring in the past 19 months as signals of an economic slowdown made both employees and employers more reluctant about recruiting.

According to the Recruitment and Employment Confederation (REC), starting salaries increased at the weakest rate in 15 months in September while job openings increased at the worst rate since February 2021, when many businesses were still subject to COVID lockdown restrictions. REC’s survey was based on responses from its members from Sept. 12-26.

The Bank of England has been closely observing the labour market in Britain for any indications that the biggest inflation in forty years may set off a chain reaction of rising wages and further price increases. The REC said, recruitment of both temporary and permanent staff rose at the slowest pace in 19 months.

“Some employers, even those who anticipate that the recession may be short, are taking steps now to contain costs, including hiring freezes,” said Claire Warnes, head of education, skills and productivity at KPMG UK, which sponsors the survey.

“Deepening economic uncertainty has also meant that workers are choosing to stay put in current roles, rather than apply for new roles,” Claire Warnes added.

The REC said that the decline needs to be understood in light of the extremely tight labour market conditions that existed earlier in 2022, the REC added.

Britain’s unemployment rate fell to 3.6%, the lowest level since 1974, even though hiring growth was far less than anticipated and job openings decreased to their lowest level in two years.

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