HR experts have shared what jobseekers need to do as new figures show the labour market cooling and unemployment at 4.9% in the UK with the “the Fourth Industrial Revolution” biting.
The UK’s labour market cooled in the second quarter, which was marked by slowing earnings growth in the private sector and the smallest number of vacancies since 2014 (aside from Covid), Office for National Statistics (ONS) official data showed on Tuesday.
Private sector regular earnings rose by 2.8% in the annual terms during the three months to June, marking the weakest growth since the three months to October 2020.
The unemployment rate held at 4.9% while the number of open job vacancies fell to 707,000 in the three months to July, down from 711,000 in the three months to July. It was the smallest total since the three months to April 2021. Excluding the pandemic, vacancies are at their lowest since late 2014.
Overall annual earnings growth, excluding bonuses, was 3.5% in the second quarter.
HR and recruitment experts gave some advice on what to do if you’re a jobseeker. You shouldn’t wait for the “right” role, you shouldn’t ping off hundreds of CVs without any direction and you need to build relationships rather than just send applications to companies and employers you don’t know.
Vacancies
Liz McKeown, Director of Economic Statistics at ONS, said: “Regular wage growth has remained broadly stable in recent months. However, private sector pay growth has continued to ease, while public sector pay growth remains elevated due to the timing of the latest NHS pay awards.
“Vacancies remain broadly flat, though a small fall in the latest period puts them at the lowest level in more than five years. The latest decrease was driven mainly by smaller businesses, which cite labour and operating costs as reasons for not hiring new staff or replacing leavers.
“The labour market picture is little changed overall, with some softening still evident. Employment, unemployment and inactivity rates have all remained steady, while the number of employees on payroll fell slightly in the latest quarter.”
Kelly Smallcombe, Fractional Chief People Officer at Meliorem HR Consultancy, said you shouldn’t wait for the “right” role to appear.
She added: “Nobody is surprised vacancies are falling, it’s the data reflecting what everyone has said: more employment rights and more costs on people means companies are less willing to take a risk on hiring. That’s tough for jobseekers, fewer roles and employers chasing ‘purple unicorns’ piling more skills onto one job than the role used to require.
“If you are a jobseeker don’t wait for the ‘right’ role to appear and assume more will follow, unless you are happy to stay. Keep several processes moving rather than pinning hopes on one. Employers that are hiring aren’t short of interest, they’re short of confidence that any one hire is safe, so anything that reduces their perceived risk moves you to the front of the queue.”
Kate Underwood, Founder at Southampton-based Kate Underwood HR and Training, said you shouldn’t just ping off loads of CVs – be more selective in what you apply for.
She added: “These figures show the jobs market has definitely cooled. There are fewer vacancies, pay growth is slowing and people looking for work are facing more competition. For employers, recruitment might feel a little easier, but that doesn’t mean you can sit back and expect great candidates to come knocking.
“Good people still have choices, and a rubbish recruitment process will still put them off. If you’re job hunting, don’t just fire off the same CV to everything with a pulse. Be picky, tailor your application, talk about what you’ve actually achieved and use your network. Speak to people, not just job boards.
“There are still jobs out there, but standing out matters more now. Fewer vacancies doesn’t mean fewer opportunities for the right person, it just means you may have to work a bit harder to find yours.”
Replaced
Debbie Denyer, Executive Coach at Beaconsfield-based Coach The Difference, said you need to build relationships rather than just send applications.
She added: “The worst thing jobseekers can do in this market is become invisible. With vacancies down to around 707,000 and private sector pay growth slowing to 2.8%, competition is intensifying. When you’re one of hundreds of applicants, sending another CV into an online application system may not be enough. Jobseekers need to get out from behind the screen.
“Identify the organisations you want to work for. Build relationships. Understand their challenges. Find people who can introduce you to others. Don’t ask for a job. Ask, ‘Who else should I be talking to?’ When employers are more cautious about hiring, being known, trusted and recommended can make the difference between being one of hundreds of applicants and being the person who gets the conversation.”
Sam Alsop-Hall, Chief Strategy Officer & Co-Founder at Birmingham-based Clive Henry Group, said AI is taking jobs.
He added: “When a job churns now, it doesn’t get readvertised. Increasingly it gets replaced by an AI agent, and that is why vacancies are at their lowest level in a decade. This is the first jobs report that really shows the Fourth Industrial Revolution biting.
“I run businesses across recruitment and healthcare workforce, and I see it on the ground every day: employers are no longer asking who should fill a role, they’re asking whether the role needs a human at all. The headline figures understate what’s happening underneath.
“Unemployment holding at 4.9% sounds benign, but 707,000 vacancies, the fewest since 2014 outside the pandemic, tells you the market is being rewired rather than simply cooling. Administrative work, entry level analysis, customer service, routine finance and back office functions are being quietly absorbed into software, vacancy by vacancy.”
