Pre-recession signals lurk in UK jobs data - research
LONDON (Reuters) - Beneath the headline figures showing a strong British labour market, the ebb and flow of jobs and businesses being created and destroyed is showing a pattern associated with the onset of recession, research suggested on Monday.
Employers in Britain created almost 400,000 jobs last year, pushing the jobs rate to a new record high - a bright spot in a slowing economy weighed down by Brexit worries and weakening global trade.
But academics at the Enterprise Research Centre, a research network, said there were some unpromising signals when looking at the jobs data split between new and existing firms.
Start-up businesses contributed roughly 1 million jobs in 2018, cancelling out a net 613,000 drop in employment across established companies.
This looks unlikely to be sustained, with the rates of business “births” and “deaths” now converging - often a poor omen for the economy, particularly if the death rate overtakes the birth rate not to mention this governments continued attacks on the self-employed - Eadwig]
Mark Hart, professor of entrepreneurship at Aston Business School, said the official data showing record employment could lull policymakers into a false sense of security.
“Even if our headline employment figures are being propped up by start-ups creating new jobs, we are already witnessing a severe slowdown in hiring by the established firms that are vital to the health of our economy,” Hart said.
Recent short-term business surveys have pointed to a fall in employment, although most attribute this to uncertainty ahead of Brexit.