A new report from the the Office for National Statistics (ONS) has found that the number of job vacancies now exceeds the number of people to fill them for the first time. That is, the number of job vacancies exceeds the number of unemployed, with the ONS report stating that "for the first time since records began, there are fewer unemployed people than job vacancies."
Job Vacancies
As we reported in a previous article, the number of job vacancies has reached record levels in 2022. The latest ONS report reveals that the number of job vacancies stands at 1,295,000, which is 23,000 down from the record peak reached in March 2022 of 1,318,000.
Nevertheless, whilst the number of job vacancies is now falling slightly from its peak, the ONS report highlighlights that the number of job vacancies exceeds the number of people who are available to fill those positions, the unemployed, for the first time ever, with the number unemployed having now fallen to 1,257,000. Hence, the number of job vacancies exceeds the number of unemployed by 38,000.
The ONS report also backs up that the so called 'great resignation' appears to be playing out, greatly assisted by the fact that job vacancies have been at record levels. The latest statistics show that there was a record 994,000 job-to-job moves during the period January - March 2022. According to the ONS, this was "driven by resignations rather than dismissals."
Parliamentary Inquiry
With job vacancies having reached record levels, there are concerns that labour and skills shortages are holding the UK economy back in terms of its recovery from the Covid-19 pandemic. As a result of this, the Business, Energy and Industrial Strategy Committee, a Select Committee in the House of Commons, are launching an inquiry in to the UK labour market. The inquiry forms part of the Committee's broader 'Post-Pandemic Economic Growth inquiry.'
As we reported in a recent article, the Government have also launched a Future of Work Review, which will focus upon how best the Government can support the labour market going forward, and “to assess what the key questions to address on the future of work are as we look to build back better from the pandemic.”
The purposes of the new parliamentary inquiry according to the Committee Chair, Darren Jones MP, is as follows: "The latest ONS figures show there’s more vacancies than people to fill them for the first time, acting as a brake on our prosperity. Recovering from the shock of the pandemic was never going to be easy, and it is made more difficult by the effects of an aging population and changes in migration."
Jones added: "To give us the best possible chance we must make sure we have the right workers, with the right skills, in the right places. That’s why we’ve launched an inquiry into what employers need to accelerate the recovery, what workers need for their own stability and growth, and how new technology can be harnessed in a fair and productive economy."
What Can Be Done In The Short Term
Whilst free movement has ended as a result of Brexit, the UK now has a points based immigration system that adapts to any labour shortages that do arise. This is done through the Migration Advisory Committee (MAC), which reviews a shortage occupation list on a regular basis and allocates additional points to those occupations where a shortage arises, in order to alleviate the problem.
Only a month ago, the MAC published a report upon the impact that the ending of free movement had had on the adult social care sector. The report concluded that: "Whilst these problems are not unique to the UK, and are indeed similar in many other high-income countries, we maintain that properly funding social care to allow improvements in pay and conditions is ultimately the key to addressing these workforce difficulties. We do not believe that immigration policy is the cause of, or the solution to, all, or even most, of the workforce problems in social care, but that immigration could potentially help to alleviate some of the difficulties, at least in the short term."
