THE number of job vacancies has fallen to a five year low, while competition for roles has soared.
There were 694,940 vacancies in January, down 3% month-on-month and 16% on the previous year, according to job matching platform Adzuna.
This is the first time vacancies have dropped below 700,000 since January 2021 and means the number of available jobs is now approaching pandemic-era levels.
The high cost of living, increased National Insurance costs and the rise of AI are all to blame for the slump, Adzuna said.
Only a few sectors have seen a rise in the number of vacancies, including domestic help, cleaning and teaching.
The news comes as unemployment climbed to 5.2% in the three months to the end of December – the highest rate since 2020.
MISSION ABORTED
Over 150 jobs axed as British rocket giant collapses into administration
TILL CHOP
Thousands of shop jobs at risk as bosses warn employment costs kill off shifts
But youth unemployment is even higher, having risen to 16.1%, the highest level in more than ten years.
The number of graduate jobs has fallen below 10,000 for the first time since Adzuna began tracking them in April 2016.
Meanwhile, entry-level vacancies fell by 4.46% monthly to 197,044 jobs, while graduate jobs plummeted by 19.1% monthly, or 45% annually.
Although vacancies are down, salaries have continued to rise in a boost for those in employment.
The average advertised salary reached £43,289 in January, an increase of 0.69% month-on-month and rise of 5.98% year-on-year.
Workers in IT, domestic help and cleaning, HR and recruitment have seen strong annual pay growth in January, outpacing the national average of 5.98% and inflation.
Meanwhile, annual public sector pay grew by 7.2%, compared to 3.4% in the private sector.
Andrew Hunter, co-founder of Adzuna, said: “For jobseekers in early 2026, the market remains challenging, with fewer vacancies and intense competition, but continued wage growth suggests employers are still willing to pay for the right skills.”
How YOU can find a job
IF you are planning to find a new job this year and are worried about higher levels on unemployment, help is available.
For starters, a good idea would be to refresh your CV and see how you can improve it in order to stand out against others applying for the same job.
Look at increasing your skills.
LinkedIn Learning, Small Business Britain, Enterprise Nation, and Help to Grow offer free training.
For example, LinkedIn Learning offers a free course on the “Foundations of Project Management”.
Now is also a good time to look at your contract and get familiar with what your notice period is, in case you want to leave or you’re made redundant.
If you’ve worked for your employer for at least two years, you are legally entitled to statutory redundancy pay, a paid notice period, and any untaken holiday pay.
The amount of redundancy pay depends on your age and length of service.