Payrolled employment fell in March after holding steady in January and February, according to the Office for National Statistics, suggesting a modest softening in the UK labour market last month – with more turbulence likely still to come. The latest data does not account for more-recent developments, including whipsawing Trump tariff developments and recently implemented hikes in National Insurance contributions and minimum wages.
The positive growth momentum in the UK economy from the first quarter could help the labour market weather some turbulence ahead. But the spike in global uncertainty makes it tough for businesses to plan with confidence, raising the risk of many employers pulling back further on hiring. As of early April, UK job postings on Indeed had already fallen nearly 10% since the start of the year.
Regular wage growth remains high at 5.9% year-on-year, but the Monetary Policy Committee’s thinking is likely to be increasingly dominated by downside growth risks over inflation risks, opening the door to more aggressive interest rate cuts in coming months.
