London (Parliament News) – The Trades Union Congress (TUC) reveals the UK’s highest unemployment increase among wealthy nations, paralleled only by Costa Rica. Despite economic growth indicators, joblessness persists, accentuating concerns about long-term economic prospects.
Unemployment is increasing in the UK at the fastest rate among 38 of the world’s richest countries, according to an investigation by the Trades Union Congress (TUC). In a release a day before official labour market formations are expected to show another gain in joblessness in Britain, the union body looked at data from the Organisation for Economic Cooperation and Development (OECD) surrounding the first three months of this year.
What Findings Did the TUC Investigation Reveal?
It discovered that of its 38 member states, only Costa Rica mourned a similar rise in the number of people losing their jobs between the start of January and the end of March. Every part of the UK was affected by increasing unemployment and a falling number of job vacancies, the TUC stated, illustrating the dislocation in the labour market between employers who cannot locate workers with the right skills and rising joblessness.
Figures from the Office for National Statistics (ONS) to be posted are expected to show a further advancement in unemployment in recent months in a collision with Rishi Sunak’s message that the economy is growing robustly.
The ONS approved last month that the economy had exited last year’s recession, rising by 0.6% in the first quarter of the year, and surveys of industry leaders show rising levels of confidence about the prospects for financial growth. Consumer confidence has also increased this year in response to a rising level of average disposable earnings. However, employers have demonstrated that despite the recovery, they are aiming to reduce their headcount.
Are Job Vacancies Declining Across All UK Regions?
Separate research by the Chartered Institute of Management (CMI) discovered that in the first three months of this year, more UK employers were drawing up plans to make roles repetitious and impose hiring freezes than in the same period last year.
The CMI survey of just under 1,000 British managers discovered that 35% of organisations planned to either freeze (21%) or decrease (14%) recruitment in the following six months. In the same period last year the integrated total was 24%, while in the summer of 2022, it was just 15%, indicating a rising trend in the number of employers wanting to limit or cut numbers of staff. When asked for the reasoning behind the decision to freeze or reduce recruitment, three in five managers (60%) blamed declining revenues or rising costs, while 55% cited organisational restructuring to decrease costs, and 34% said it was due to improved economic uncertainty.
One in five managers also noted higher staff pay (19%) as the reason for lowering the number of employees, with a smaller number (13%) citing the expanded use of digital technology and automation.
How Are Public Sector Employers Responding to Budget Cuts?
Public sector employers were more likely to state they were planning to decrease staff numbers, with three-quarters expressing budget cuts were the main reason. The analysis will add to concerns among some Bank of England policymakers about the fault of the longer-term economic outlook. The central bank’s monetary policy committee will decide at a meeting later this month whether to fetch interest rates down from their current level of 5.25%.
Broadly, the strategists at JP Morgan prefer the domestically concentrated FTSE 250 share index of medium-sized businesses listed in London over the blue-chip FTSE 100, which has more of an international guide.
JP Morgan’s ruling on Starmer’s Labour stands in stark contrast to its disapproval of Corbyn’s policies, including nationalisation of several initiatives. In 2019, JP Morgan expressed a Labour government “would weigh heavily” on the minds of foreign investors. Nevertheless, not all big businesses would accommodate a Labour government in 2024, JP Morgan stated, citing the promised nationalisation of the train network and recommendations to increase taxes on energy companies. Water companies are also likely to encounter increased regulation, but other utilities could profit from spending on net zero energy infrastructure.