The UK’s job market faces significant challenges, with vacancies dropping nearly one-fifth from last year, despite economic growth.
- Annual job vacancies have decreased by 19.49%, mirroring a challenging environment despite a 0.4% GDP growth in May 2024.
- Job seekers per vacancy have increased, reaching a three-year high, indicating a tightening job market.
- Average advertised salaries are on the rise, yet salary transparency in job ads has fallen to new lows.
- Professional services show promising signs of recovery, contrasting declining vacancies in other sectors.
The United Kingdom’s job market is currently navigating a complex landscape, as evidenced by a substantial 19.49% decline in annual job vacancies compared to the previous year, totaling 852,703. This trend continues despite a modest GDP increase of 0.4% recorded in May 2024, suggesting that economic expansion has not yet translated into enhanced hiring activities.
A critical measure of job market health, the ratio of job seekers to vacancies, has increased to 1.95, the highest figure in three years, up from 1.91 in May. This data implies a more competitive environment for job hunters. Concurrently, the duration for which jobs are advertised has slightly decreased from 36.9 to 36 days, pointing towards a more dynamic labor market.
In response to the decline in vacancies, average advertised salaries have risen by 0.18% since May and 2.72% year-over-year, now reaching £38,843. These increases suggest a continued tightening of the labor market. However, tracking these salary trends is becoming increasingly difficult as employers increasingly omit salary details in job advertisements. The percentage of job ads citing salary fell to 47.7%, the lowest since monitoring began in 2016, with June historically being a low month for such transparency.
Professional service sectors are showing signs of renewed hiring activity. The legal sector saw the largest monthly increase in job openings at 8.46%, followed by notable growth in PR, Advertising & Marketing and Creative & Design sectors at 3.78% and 3.46%, respectively. June marked the first rise in IT sector vacancies since June 2023, with Domestic Help & Cleaning sectors also witnessing notable growth. However, traditional growth sectors like Hospitality & Catering experienced a decline in job postings this month.
Despite the general decline, some sectors, notably Teaching and Travel, saw year-over-year increases in vacancies. Additionally, while most industries reported rising salaries, IT salaries declined due to shifts in demand and industry dynamics. The Energy, Oil & Gas sector witnessed a significant 20.33% increase in average salaries, attributed to skill shortages, geopolitical factors, and a transition to renewable energy sources.
Regionally, the West Midlands maintains its position as the UK’s fastest-growing region for salaries, seeing a 5.48% annual increase. In contrast, London offers the highest salaries at £44,867 but shows lower growth at 1.45% since last June. Cambridge remains the most favorable location for job seekers with a low ratio of job seekers to vacancies, highlighting regional disparities.
Warehouse roles continue to be the most sought after, with Cleaner roles gaining interest among job seekers. According to Andrew Hunter, co-founder of Adzuna, while economic growth is evident, it may take until after the summer holiday period for this to translate into job creation.
The UK’s job market presents a complex yet evolving landscape, with pockets of growth amid broader challenges.
