In simple words, UK companies struggled with the unemployment rate, bidding up pay, and finding staff. The workers' shortage is on the pay scale’s both ends, including high-tech jobs like IT and Finance. Other positions that European Union migrants filled, like leisure & hospitality, are also facing shortages. Overall, the UK number of employed people rose by 94,000 amid a 13,000 fall in the number of inactive people and a 25,000 decrease in unemployment.
Despite the Russia-Ukraine war, Covid-19, and Brexit shocks, the UK economy rose slowly, leading to analysts ruling out a recession. The BoE has clarified that the workers' shortage could cause inflation pressures, requiring more interest rate hikes. Jeremy Hunt vowed to lower the inflation rate and boost consumers spending power to bring down the cost of living. Besides hurting people’s paychecks, the soaring inflation squeezed household living standards.
All in all, the global market could face the worst industrial strife from the 1980s after real wages remained 1.3% lower than in 2022. Above all, the number of payroll employees increased to 22,879 in May. The ONS also revised the payrolls decline in April, replacing it with a 6,822 rise. Analysts believe the Bank of England will continue raising the borrowing costs throughout the summer, starting with an increase to 4.75% on 22nd June. This rise would mark the highest rate in ten years since the beginning of the global financial crisis.