Labour Market Analysis | February 2023


	Making learning and work count Labour market LIVE from Learning and Work Institute 14 February 2023 Unemployment is 1,270,000, up by 26,000 on last month’s published figure, and the unemployment rate 3.7%, is up by 0.1 percentage points on last quarter. The ONS figure for claimant unemployed is 1,526,500, down by 12,900 on last month. The number of workless young people (not in employment, full-time education or training) is 1,001,000, up by 115,000 on the quarter, representing 14.6% of the youth population. Youth unemployment (including students) is 471,000, up by 72,000 on the quarter. Vacancies in Nov-Jan 2022 (in the ONS official series) fell for the 8th month in a row to 1,134,000, down from their 2022 peak of 1,300,000. There are now 1.1 unemployed people per vacancy. The employment rate is 75.6% (up by 0.1 percentage points on last month’s published figure and up by 0.2 percentage points in the preferred quarterly measure). Stephen Evans, Chief Executive at the Learning and Work Institute, said: ‘Real earnings are falling at their fastest rates since the financial crisis due to high inflation, leaving them no higher now than before the pandemic. A miserable 15 years for real wage growth means people would be earning £11,000 a year more on average if pre-financial crisis trends had continued. So as well as bringing inflation under control, we urgently need a growth plan for our economy. There was a welcome fall in economic inactivity, but it was driven more by a reduction in young people studying than older people returning to the labour market. Economic inactivity is still 500,000 higher than pre-pandemic, and almost 2.5 million people are out of the labour market due to long-term sickness. Only one in ten out-of-work older people and disabled people get help to find work each year, the Chancellor must change that in next month's Spring Budget.’ Helen Gray, Chief Economist at the Learning and Work Institute, said: ‘It is reassuring to see a further reduction in economic inactivity in the final quarter of 2022, although a large portion of this was due to a fall in the number of students. The employment rate also rose by 0.2 ppts to 75.6 per cent. There was a slight increase in unemployment, but the numbers of vacancies to be filled remain high in historical terms, albeit below the levels seen at the height of the pandemic. The overall picture of greater labour market participation in recent quarters is encouraging, but there is a long way to go to return to the levels seen before the pandemic. Half-a-million more individuals remain economically inactive and there are a quarter of a million fewer people in employment compared with December 2019-February 2020. Further action is needed to increase labour market participation by older people and the long-term sick, in particular, if early signs of recovery are to be sustained. It is also notable that 1.7 million working days were lost to strike action in the final quarter of 2022. This far exceeds the million days lost in the final quarter of 2011, at the height of the dispute over public sector pension reforms. Although industrial action is well below the level seen in the 1980s, ongoing disputes pose a threat to prospects for economic growth.’ Labour Market Briefing Employment increased by 74,000 between July to September 2022 and October to December 2022. In the last 12 months employment rose by 246,000. Unemployment rose by 45,000 between July to September 2022 and October to December 2022. Over this period, the unemployment rate is up by 0.1 percentage points to 3.7% in the most recent quarter. Economic inactivity fell by 113,000 between July to September 2022 and October to December 2022. The inactivity rate has fallen by 0.3 percentage points to 21.4% in the quarter. The national claimant count has decreased by 12,900 to 1,526,500 Youth unemployment rose by 72,000. There are 471,000 unemployed young people, and 321,000 (4.7% of the youth population) who are unemployed and not in full-time education. Self-employment increased by 117,000 this year. The number of employees is up by 108,000 over the year. Involuntary part-time employment has fallen by 31,000 this quarter to 0.8 million, 9.5% of all part-time workers.
	Chart 1: UK unemployment (ILO) The latest unemployment rate rose by 0.1 percentage points to 3.7%.
	Chart 2: The claimant count and UK unemployment compared The number of unemployed people who are claiming unemployment-related benefits is now 257,000 higher than the number of unemployed in the official measure.
	Chart 3: Youth unemployment The number of unemployed young people (aged 16-24) is up by 10,000 since last month’s figures, to 471,000. Meanwhile, the number of young Universal Credit or Jobseeker’s Allowance claimants (aged 18-24) last month rose by 400, to 266,800.
	Chart 4: Young people not in employment, full-time education or training The number of young people not in employment, full-time education or training (1,001,000) is up by 115,000 in the last quarter, or 12.9%. 68% of young people not in full-time education or employment are economically inactive, rather than unemployed. To be counted as unemployed, people need to be both actively seeking work and available to start. People out of work who do not meet these criteria are counted as economically inactive.
	Chart 5: Youth long-term unemployment (six months and over, 16-24) Youth long-term unemployment (which can include students) is unchanged over the last quarter and is now 111,000. Long-term unemployment for young people is normally counted as being unemployed for six months or more.
	Chart 6: Adult long-term unemployment (12 months and over, 25+) Adult long-term unemployment on the survey measure is now 211,000. The number people aged 25 and over out of work for 12 months has fallen by 27,000 compared with before the pandemic (December 2019 - February 2020).
	Chart 7: Unemployment rates by age The 18 to 24 year old unemployment rate (including students) is 10% of the economically active – excluding one million economically inactive students from the calculation. The rate for those aged 25 to 49 is 2.8%. For those aged 50 and over it is 2.4%. The quarterly change is 1.55 percentage points for 18 to 24 year olds, -0.05 percentage points for 25 to 49 year olds, and -0.17 points for the over-50s.
	Chart 8: Unemployment rate changes by age (counting February 2020 as 100) The 18 to 24 year old unemployment rate (including students) is 0.5 percentage points lower than in February 2020. The unemployment rate has increased by 0.1 points for those aged 25 to 34. There is no change for those aged 35 to 49. There was a reduction of 0.5 points for those aged 50 to 64 and 0.4 points for those aged over 65.
	Chart 9: Vacancies – whole economy survey Headline vacancies this month are down by 20,000 to 1,134,000. The ONS' experimental single-month vacancy figures has fallen by 196,000 in the last quarter. The headline ONS vacancy figure is both seasonally adjusted and a three-month average. The chart shows both series.
	Chart 10: UK employment Employment increased by 33,000 on the figure published last month, to 32,813,000. The chart shows both the official figures and the experimental monthly figures.
	Chart 11: Employment rate in the UK The employment rate has risen by 0.2 percentage points over the quarter, to 75.6%. The chart shows both the official figures and the experimental monthly figures.
	Chart 12: Economic inactivity – the long-term sick or disabled The number of people who are economically inactive (that is, not working and not currently looking for work) who are long-term sick or disabled has risen by 3.3% in the last 6 months to more than 2,465,000 working age people.
	Chart 13: Economic inactivity – people looking after family The survey figures showing those looking after family and not doing paid work or looking for paid work had been trending downwards but have been rising steadily since early 2021. There are now 1,700,000 people looking after family and not working, compared to a low point of 1,590,000.
	Chart 14: Economic inactivity – other inactive In the Coronavirus period, people who were not working or looking for work due to Covid were included in this group. The number in this category increased sharply at the time, but has since declined. A very high proportion of this group want to work. There are now 1,110,000 people who are classified as economically inactive - other, 31% of which want to work. This is compared to a high point of 1,290,000.
	Chart 15: Employment rate three-year change in regions – October to December 2022 This quarter, compared to 2019 3 regions showed a rise in the employment rate, the largest increase being in Scotland. The employment rate fell in 9 regions, the greatest fall being in the East Midlands.
	Chart 16: Inactivity rate three-year change in regions – October to December 2022 This quarter, compared to 2019 10 regions showed a rise in the inactivity rate, the largest increase being in the East Midlands. The inactivity rate fell in 2 regions, the greatest fall being in Scotland
This newsletter is produced by Learning and Work Institute and keeps readers up to date on a wide range of learning and work issues. If you have any questions, contact Chris © 2022 Learning and Work Institute. All rights reserved. To subscribe click here