The ONS estimates underlying pay growth is running at 3.9 per cent to 5.1 per cent. Image Credit: Bloomberg

London: UK companies added payrolls at a record pace in June as the reopening of the economy triggered an unprecedented scramble for staff. The number of employees on company books climbed by 356,000, the Office for National Statistics confirmed on Thursday.

Demand for staff rose, with vacancies in June alone increasing to a record 962,000, up 7 per cent from May. "The rise in vacancies confirms the ongoing struggle to hire staff," said Suren Thiru, head of economics at the British Chambers of Commerce. "The recruitment difficulties faced by firms go well beyond temporary bottlenecks. Staff shortages may drag on any recovery."

The figures come a day after Bank of England Deputy Governor Dave Ramsden highlighted the unexpected buoyancy of the labor market and signalled that officials may soon have to consider whether to withdraw emergency stimulus to keep inflationary pressures in check.

Speedy salary gains

Wages including bonuses rose an annual 7.3 per cent in the three months through May, the fastest on record. The increase reflected depressed wages a year earlier, the loss of low-paid jobs and the return to full-time work of staff who were previously furloughed on just 80 per cent of their pre-pandemic salary. The ONS estimates underlying pay growth is running at 3.9 per cent to 5.1 per cent.

"We are bouncing back," Rishi Sunak, Chancellor of the Exchequer, said in a statement. "The number of employees on payrolls is at its highest level since last April and the number of people on furlough halved in the three months to May."