The unemployment rate stood at 3.8% in March-May, unchanged from the previous quarter and approaching its pre-pandemic level, while job openings fell from the previous record high in the three months to June, according to the ONS. In addition, employment rose by 30,000 in June compared to May, setting a new record. However, total earnings fell in real terms in the three months to May due to rising inflation.
Overall, recent data suggests that the labor market is in good shape, but lower vacancy rates may indicate a decline in activity. The unemployment rate is projected to remain low by historical standards until the end of 2022 at around 4%, although rising inflation will continue to reduce purchasing power and reduce consumer spending.
FocusEconomics Consensus Forecast experts expect the unemployment rate to average 4.0% in 2022, unchanged from last month’s forecast, and 4.3% in 2023.