Britain’s labour market cooled noticeably last month as job placements fell sharply and wage growth slowed, according to a survey of recruiters on Monday that could bolster the case for interest rate cuts by the Bank of England.
The monthly Jobs Report from the union for recruitment and employment professionals and accounting firm KPMG showed permanent job placements fell at the fastest pace in five months.
Starting salary growth for permanent staff also fell to a five-month low, one of the weakest readings since early 2021.
Jon Holt, chief executive and senior partner at KPMG in the UK, said business confidence continued to fluctuate, despite an interest rate cut by the BoE last month.
“News that while wages rose last month it was at the weakest pace since March could help justify further rate cuts when the Monetary Policy Committee meets to decide the future path of interest rates,” Holt said.
The vast majority of economists polled by Reuters think the BoE will wait until November to cut interest rates again, although financial markets currently show a one-in-four chance of a rate cut on Sept. 19.
Official labor market data on Tuesday is expected to show solid job growth and further moderation in wage growth.
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