The UK’s recovering economy continues to power strong job creation. The number of employees on payrolls rose for the sixth consecutive month in May, up nearly 200,000 from April. That was a record rise on data going back to 2014.
The rebound of the hospitality sector amid May’s easing of lockdown restrictions on pubs and restaurants was a key driver. Vacancies in accommodation and food services jumped by 266% in the March to May period versus the previous quarter.
Employers in other sectors are busy ramping up their hiring too. There were 758,000 vacancies across the UK between March and May, only 27,000 below their pre-pandemic level in January to March 2020. Most industries now show vacancies above pre-pandemic levels.
But there’s still a long way to go. Payroll employment remains approximately 550,000 down on February 2020 levels, while there were still around two million furloughed workers in May. Hours worked remain well down on the pre-pandemic trend.
So there is still considerable slack to absorb as the furlough scheme is tapered from the end of July. With the stage four easing of restrictions now pushed back to 19 July and the Chancellor rejecting an extension of furlough, the prospect of an autumn spike in unemployment remains on the table.