Results are in for the performance of the UK’s economy in the three months leading up to March, and it is good news as far as the labour market across the country is concerned.
Yesterday, the Office for National Statistics (ONS) revealed that the UK unemployment rate is currently holding steady at 4.7%. This means that the number of jobless in the UK remains at a nearly 12-year low; an encouraging figure indicating that new job creation has not necessarily weakened despite Brexit.
Additionally, the number of job vacancies in the three-month period to the end of March also increased by 16,000, to a record high of 767,000. A lot of this growth was seen in London, which is continuing to generate new opportunities. Britain’s employment rate now stands at 74.6%, the joint highest since comparable records began in 1971.
However, it seems that the roll-out of the National Living Wage isn’t quite having the desired effect on average earnings. The ONS report also shows that 40 per cent of the workforce are experiencing shrinking pay. This is a result of wage rises failing to match inflation, which stubbornly remains at 2.3% – the highest rate since September 2013.
With current inflation rates looking like they are here to stay, many SMMEs across London stand to lose out, particularly those that rely heavily on imports. The increased cost of imports means more expenditure, the costs of which will be passed onto consumers. Consumers, in turn, have to cut back their discretionary spending in order to offset rising costs of food, petrol and household goods.
SMMEs are going to have to ensure that their marketing strategies are responsive to these different consumer behaviours in order to continue attracting new business.
Start-ups in London
Although more jobs are being created, research by Creditsafe, a business intelligence company, has shown that London may be losing its attractiveness as a hub for start-up enterprises. In the six months following the announcement that Britain will be leaving the EU, the number of new start-ups in London decreased by 13 per cent, spelling bad news for the tech industry. Other European cities including Berlin and Dublin, by contrast, are seeing growth in these numbers, although they still have some way to go before they overtake London.
For advice on supporting your start-up’s growth, take a look at our recently-updated events page to see how your SMME could benefit from the free, tailored business support on offer.