The UK's job market faces a downturn, with unemployment rising to 4.6%, the highest level in almost four years. The decline in job vacancies marks the sharpest drop since mid-2023 and suggests that businesses are hesitant to recruit amid rising employment costs. Chancellor Rachel Reeves hopes slower wage growth may prompt interest rate cuts from the Bank of England, as wage growth fell to 5.2%. Governor Andrew Bailey emphasizes the importance of wage trends in monetary policy decisions, while MPC members express concerns over prolonged high interest rates impacting growth.
"Unemployment has continued to rise, ticking up to 4.6% in the three months to April, reflecting a gathering pace of downturn in the UK's jobs market."
"The governor of the Bank of England, Andrew Bailey, sees wage growth as the key determinant for whether interest rates can be decreased from their current elevated level."
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