The UK’s job market has continued to weaken with the number of workers on payrolls falling in the first quarter of the year.
The number of job vacancies also fell again, according to the latest figures from the Office for National Statistics (ONS).
Wage growth slowed, but pay is still rising faster than the rate of inflation.
Regular earnings, which exclude bonuses, grew at an annual pace of 5.6% in the first three months of the year.
The unemployment rate increased to 4.5% in the January to March period, the ONS said, up from the previous figure of 4.4%.
The number of people on payrolls fell by 53,000 over the first three months of the year, and the early estimate for April indicates payrolls fell by 33,000 during the month.
Increases in employer National Insurance contributions and the National Living Wage both came into force in April, and ahead of the changes some firms had warned it could affect recruitment.
“The further softening in employment in April suggests businesses continued to respond to the rise in business taxes and the minimum wage by reducing headcount,” said Ruth Gregory, deputy chief UK economist at Capital Economics.
While wage growth had slowed, she added, it still remained relatively strong, leaving the Bank of England in a “tricky position” over future interest rate cuts.
“Sticky wage growth may mean the Bank remains uneasy about inflationary pressures in the near term,” she said.
“As a result, the ‘gradual’ interest rate cutting path will remain the balancing act.”
