UK Layoffs Hit 5-Year High

The Situation of Layoffs in England

According to data released by the Office for National Statistics (ONS), layoffs in England have reached the highest level in the last five years. In December, the number of payroll employees decreased by 43,000, which is twice the expectations of the markets. This is recorded as the largest decline seen since 2020.

Unemployment Rates are Rising

According to the ONS labor force survey, the unemployment rate has approached 5.1%, the highest levels in the last five years, for the three-month period ending in November.

Decline in Wages

Excluding bonuses, the wage increase declined from 4.6% to 4.5% for the three-month period from October to November, in line with expectations. However, the wage increase in the private sector fell to 3.6%, dropping more than expected.

Uncertainties in the Labor Market

Bank of England (BOE) policymakers note that these developments in the labor market are raising warnings that the economic crisis could deepen. The layoff rate has increased from 3.8 per 1,000 people for the three-month period ending in August to 4.9 for the period ending in November. In December, companies reported only 21,192 potential layoffs, the highest figure since the beginning of the pandemic.

Increase in Vacancies

On the other hand, the number of vacancies has been reported as 734,000, showing an increase of 10,000 compared to the July-September period.