UK labour market cooled rapidly in June, KPMG/REC survey shows

UK Labour Market Experiences Rapid Cooling in June, KPMG/REC Survey Finds

(Reuters) -Britain's labour market cooled sharply in June and the number of people available for work jumped at the fastest pace since the COVID-19 pandemic, a survey of recruiters showed on Monday.

The Recruitment and Employment Confederation trade body and accountants KPMG said their index of staff availability rose to 66.1 from 63.3 in May, the highest reading since November 2020.

Only the pandemic, the global financial crisis of 2008-09 and the immediate aftermath of the Sept. 11 attacks in the United States have resulted in higher readings of slack in the labour market.

REC and KPMG said the latest readings reflected unusually high levels of uncertainty rather than a sudden downturn in Britain's economy.

"Ongoing geopolitical turbulence and the threat of rising costs, alongside the promise of technology efficiencies, mean companies continue to wait and see with their hiring," said Jon Holt, group chief executive at KPMG.

The survey is watched by Bank of England officials who are increasingly relying on unofficial gauges of the labour market because of problems with some official data. The BoE is widely expected to cut interest rates next month.

Starting pay for new recruits and demand for staff cooled, adding to signs that the labour market is losing momentum.

Figures due out from the Office for National Statistics on Thursday are expected to show a similar slowdown in pay growth.

British economic growth contracted unexpectedly in May, according to official data published last week.

While U.S. President Donald Trump remains unpredictable on his approach to trade tariffs, last month's publication of the British government's industrial strategy might increase certainty among companies' hiring plans, Holt said.

(Reporting by Andy BruceEditing by William Schomberg)