The UK was supposed to be facing a spike in unemployment after the pandemic furlough schemes ended, but instead the job market is the tightest in a generation. Given that there are also more vacancies than active job seekers and many sectors are struggling with skill shortages, you might expect to see pay rising, productivity improving and new job opportunities for those at the margins.
Yet real pay growth has been stagnating for at least a decade. Productivity has only recently climbed back to pre-2008 levels. And most worryingly, we are seeing a participation crisis, with a record 640,000 increase in economically inactive people since the start of the pandemic.
