UK job vacancies fall to lowest level in nearly four years

Job vacancies fell to the lowest level in nearly four years, according to official figures, suggesting demand for workers is weakening as employment costs grow.

The number of jobs on offer dropped to 781,000 in the first three months of the year, the Office for National Statistics (ONS), while people on payrolls also declined.

Average UK pay continued to rise - up 5.9% - but increases in employer National Insurance Contributions as well as National Minimum Wage hikes which came into force this month are forecast to weigh on salaries.

Yael Selfin, chief economist at KPMG UK, said: "The short-term impact of the rise in labour costs which came into effect in April, will likely put downward pressure on pay over the coming months."

The ONS said the UK unemployment rate remained at 4.4%, roughly the same as the previous three months.

The employment rate for people aged 16 to 64 years was 75.1%, still below Labour’s target of 80% employment.

The ONS said its jobs figures should be treated with caution because of low response rates to its employment survey, on which the figures are based.

Wage growth is slightly ahead of the previous period and was lifted by the public sector, according to Liz McKeown, director of economic statistics at the Office for National Statistics which published the figures.