The latest ONS labour market report indicates a decline in employment alongside a rise in unemployment, returning vacancies to pre-COVID levels. Although there has been a small drop in inactivity, this has contributed to unemployment's increase. While real earnings are rising, the benefits are offset by rising taxes. Future legislation from the Employment Rights Bill is expected to further discourage hiring by raising costs, particularly affecting businesses considering new, young employees. The overall labor market outlook appears grim, providing little hope for economic growth in the near future.
This morning's labour market release from the ONS reflects predictable trends of reduced employment, increased unemployment, and falling vacancies due to upcoming wage hikes.
Rising real earnings may provide comfort for workers, yet many find these gains eroded by higher taxes as salaries rise into non-inflation-adjusted brackets.
Measures in the Employment Rights Bill set to take effect in the next eighteen months will increase costs for employers, particularly affecting hiring of young labor.
The current outlook for the labor market indicates a challenging environment for businesses, casting doubts on the potential for economic growth and stability.
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