Cliff Notes
- The jobs market has seen a continuous decline, with 9,000 fewer vacancies reported over the last three months and a rising unemployment rate now at 4.8%, mainly affecting younger individuals.
- Private sector wage growth has dropped to the lowest rate in nearly four years at 4.4%, while public sector wage growth has increased to 6% due to early pay rises.
- This slowdown in wages may lead to a reduction in interest rates, with traders anticipating a decrease to 4.75% in December.
Getting a job became harder with fewer vacancies – official figures | Money News
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The jobs market continued to slow, with 9,000 fewer vacancies in the three months to September, official figures show.
It is the 39th consecutive period where vacancy numbers have dropped.
Having fewer job openings can mean it is harder to find work.
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There was also a surprise increase in the unemployment rate, up to 4.8% from 4.7% a month earlier, primarily driven by younger people, as a record number of people over 65 are in work, the Office for National Statistics (ONS) said.
Economists polled by Reuters anticipated no change in the jobless rate.
The ONS, however, has advised caution when interpreting changes in the monthly unemployment rate and job vacancy numbers due to concerns over the reliability of the figures.
Further signs of a slowing labour market were seen in the fall of annual private sector wage growth to the lowest rate in nearly four years – 4.4%.
Public sector pay growth increased more quickly, at 6%, as some public sector pay rises were awarded earlier than they were last year.
Average weekly earnings rose more than expected by economists at 5% and also more than previously thought after a revision to last month’s figures (4.8%).
Also published by the ONS was data on industrial action, which showed August had the fewest working days lost to strike action in a single month for nearly six years.
What does it mean for interest rates?
While a tough job market is difficult for people looking for work, the slowing wage rises can mean interest rates are brought down.
The rate-setters at the Bank of England had been concerned about the effect higher wages could have on inflation, which it is mandated to bring to 2%.
Following today’s figures, traders expect a cut in the interest rate to 4.75% in December.