Commenting on the labour market statistics for March 2017, published today by the Office for National Statistics, Suren Thiru, Head of Economics at the British Chambers of Commerce (BCC), said:
“The UK’s jobs market is going from strength to strength, with the number of people in work continuing to rise and unemployment also falling.
“UK labour market conditions may cool over the next few years as the expected slowdown in growth and the rising burden of upfront business costs stifle firms’ hiring intentions. That said, we expect that the UK unemployment rate will reach a peak of 5.3% next year, still some way below the historical average.
“However, average pay growth continues to slow, and it appears increasingly likely that inflation will outstrip earnings growth in the coming months, which will put further pressure on consumer’s spending power.
“With Article 50 set to be triggered shortly, it is vital that more is done to provide greater clarity and stability for firms, including certainty on the residence rights of their existing EU workers, and clarity on the regime for hiring from EU countries during the negotiation period. Further action is also needed to ease the burden of upfront costs and taxes of doing business in the UK, which limit companies’ ability to invest and grow.”