Jessica O'ConnorYouth employment risks being left behind as the UK labour market shows further signs of slowing, according to the CIPD, the professional body for HR and people development.
The warning comes as new figures from the Office for National Statistics (ONS) revealed a continued drop in job vacancies, now at levels last recorded in early 2015.
James Cockett, senior labour market economist for the CIPD, said: “The labour market is continuing to cool as vacancies continue to fall, reaching levels last seen in early 2015. The impact of the national insurance changes on employers’ costs is clear, with pronounced falls in employee numbers in hospitality and retail over the past year.”
The latest ONS data points to a challenging environment for employers, with rising employment costs hitting sectors that traditionally provide first jobs for many young workers.
Cockett stressed the importance of not allowing these pressures to reduce opportunities for those starting their careers.
He said: “As employment costs increase, it’s critical that employers aren’t dissuaded from hiring young people. Industries like hospitality and retail provide meaningful job opportunities for young people at the beginning of their working lives.
“The government needs to go further than the youth guarantee and introduce an apprenticeship guarantee for all 16 to 24-year-olds, to provide valuable opportunities for young people to both learn and earn.
“Better training and employment opportunities will ensure they start their working lives on the right foot while helping employers build future talent pipelines.”
While pay growth remains strong in certain sectors, the CIPD notes that inflation is eroding real wage gains.
Cockett added: “Today’s figures also show that pay growth remains high, particularly in hospitality and retail, which have been disproportionately impacted by rises in national insurance and the minimum wage. But inflation is biting at real wage growth, which has reached its lowest level in two years.”
