Future prospects “cloudy” as labour market data “paints a positive picture”, says IEA expert
Commenting on today’s ONS labour market data, Professor Len Shackleton, labour market expert and editorial and research fellow at free market think thank the Institute of Economic Affairs, said:
“This morning’s figures continue to paint a positive picture of the labour market, by contrast with the gloomy GDP figures.
“Total employment and the employment rate are up again, while the unemployment rate and economic inactivity are down. Pay is a mixed bag, with basic pay falling in real terms but with bonuses meaning some workers are up in real terms.
“Several of these indicators appear after a lag, and cover February to April, but payroll employment and vacancies offer a more recent perspective and also show a positive picture.
“The post-Covid labour market is continuing to adjust and there are still a lot of people changing jobs after a long period of lockdown. I would hope older worker economic activity will recover in the coming months, and self-employment – still way below its pre-Covid levels – should continue its modest climbback.
“However this depends on the way consumer and investment spending reacts in the face of rising inflation, and whether the government finds a way to reduce the growing burden of taxation.
“Nothing to despair of in these labour market figures, but future prospects remain cloudy.”