Employment was hit hard during the pandemic, but has shown signs of recovery since the end of 2020.
The number of UK workers on payrolls rose by 241,000 to 29.1 million between July and August, returning to the levels of February 2020, just before the start of the CCP (Chinese Communist Party) virus pandemic.
Meanwhile, the number of job vacancies has seen even more significant growth. Vacancies increased by 35.2 percent in June–August 2021 compared with the last quarter. The largest rise in vacancies was seen in accommodation and food service activities, which rose by 75.4 percent.
Chancellor Rishi Sunak said the new figures “show that our plan for jobs is working.”
“As we continue to recover from the pandemic, our focus remains on creating opportunities and supporting people’s jobs,” he said.
But Jonathan Athow, ONS deputy national statistician for economic statistics, cautioned that the recovery “isn’t even.”
“In hard-hit areas such as London, and sectors such as hospitality and arts and leisure, the numbers of workers remain well down on pre-pandemic levels,” he said.
Labour shortage has become an acute problem for the economy. Athow said the hospitality sector recorded “the highest proportion of employers reporting their job openings are hard to fill.”
Matthew Percival, director of people and skills at the Confederation of British Industry, said “ongoing supply and labour shortages are impeding further growth.”
He urged the government to loosen migration rules “so that firms can temporarily fill the most significant vacancies.”
Suren Thiru, head of economics at the British Chambers of Commerce, said “rising cost pressures and an increasingly onerous tax burden [are] likely to stifle firms’ recruitment intentions,” and as a result the UK’s unemployment rate is likely to rise to 5.1 percent in early 2022.
British businesses have complained that the government’s decision to raise taxes despite having pledged in its 2019 election manifesto not to do so.
On Sept. 7, Prime Minister Boris Johnson announced a new UK-wide 1.25 percent health and social care levy, which is based on National Insurance contributions. He said the £12 billion ($17 billion) tax hike was needed to reform social care funding and to help the National Health Service clear the backlog caused by the pandemic.
