Online job advertisements in the UK rose another 1.9% in the week to June 4th, according to the ONS. On this measure, vacancies are now 28.9% above February 2020 levels.
Despite the strength of the UK, ‘official’ BLS job openings in the US (public and private sector) have recovered even more quickly, up 32.4% as of April.
Based solely on vacancies, the Fed should hike first. The larger fiscal stimulus in the US would also favour this view. The lifting of UK restrictions planned for June 21st may be delayed too.
But the latest claims data out from the States yesterday provided a warning: initial claims were down just 9k to 376k in the week ending June 5th.
The pandemic may have affected the UK labour market less. The US has a much longer way to go to get the labour force participation rate back up to pre-pandemic levels. Furthermore, the median wage tracker in the US is currently tracking lower, with the y/y (3-month moving average) easing to 3.0% in May. This could bide the Fed time.
The UK is set for a big jump in employment in May. The number of payrolled employees climbed 97.2k in April according to a flash estimate from real-time PAYE data. A similar rise in May is possible and will bring forward market expectations for the first BoE rate hike.
