• The ONS figure for claimant unemployed is 2,663,700, and has risen by 64,300 on last month, and up by 1.42 million since March, and the claimant rate is 7.4%.
• The ONS figure for 18-24 claimant unemployed is 516,900 in November, up by 281,800 or 119.9% on March.
• Vacancies in November fell back by 66,000 to 557,000 after recovering strongly from the low point of 327,000 in May.
• Unemployment is 1,692,000, up by 68,000 from last month’s published figure (quarterly headline increased by 241,000) and the unemployment rate 4.9%, increased by 0.2 percentage points on last month and has risen by 0.7 percentage points on last quarter.
• The number of workless young people (not in employment, full-time education or training) is 1,005,000, up by 36,000 on the month, representing 14.7% of the youth population, up by 0.6 percentage points on last month.
• Youth unemployment (including students) is 596,000, has risen by 29,000 on the quarter.
• There are 3.2 unemployed people per vacancy.
• The employment rate is 75.2% and fell 0.1 percentage points on last month’s published figure and reduced by 0.5 percentage points in the preferred quarterly measure.

Learning and Work Institute comment

The labour market figures published on 15 December suggests that even with the Coronavirus Job Retention Scheme in place that 'open' unemployment is rising with large numbers of redundancies as the number of furloughed workers declines.

Duncan Melville, Chief Economist at Learning and Work Institute, commented:

Employment fell by 144,000 in the three months to August to October and in the year by 280,000, the largest annual fall in employment since the first three months of 2010. In contrast, the monthly data showed a substantial rise in employment in October of 113,000. However, the timelier HMRC data for November indicated a small fall in the number of employees on payrolls. Unemployment rose substantially by 241,000 in the three months to August to October, while the monthly data showed a rise of 114,000 in October. Alongside these numbers total hours worked continued to trend up in October and at the end of the month were at around 95% of their pre-pandemic levels.

Rising unemployment and rising working hours reflect a move away from furloughed workers who are formally employed even if they are not doing any hours of work towards 'open' unemployment. This view is supported by the numbers temporarily away from paid work and the numbers being made redundant. The numbers of people temporarily away from paid work continued to trend down and at the end of October stood at 3.6 million workers compared to pre-pandemic levels of around 2.5 million and the peak levels of between eight and nine million seen between mid-April and mid-May.

The number of people reporting redundancy in the last three months in the August to October quarter increased by a record 217,000 on the quarter, to a record high of 370,000 - well above the levels seen in the aftermath of the 2008 financial crisis. Weekly data show that the number of people reporting redundancy in the last three months had been increasing since June and peaked in mid-September at just over 500,000 and has been declining since then to stand at just under 300,000 at the end of October. This is still around two and a half times the average level of redundancies seen in the first half of 2020.

The data for November this year suggests that the labour market probably deteriorated in this period. The number of vacancies fell in the month compared to October by 11 percent to 557,000 - this followed five months of increasing vacancy levels and probably reflects the impact of the November lockdown deterring employers from taking on new staff. In line with this the claimant count rose by 66,000 in November following a couple of monthly falls.

Looking further forward there are some hopes for an improving outlook. The rapid development of several apparently effective vaccines, and the beginning of the vaccine rollout, offers the opportunity to bring the pandemic under control in spring and summer of next year. This should reduce the need for social distancing requirements, allowing the economy to bounce-back as 2021 progresses.

However, it remains the case that the outlook looks far from rosy. The Office for Budget Responsibility (OBR) expects unemployment to peak at 2.6 million next year in the April to June quarter even if the UK and the EU agree a trade deal which currently remains far from certain. The lack of a post-Brexit trade deal would deliver a further shock to the economy. The OBR's forecasts suggest that no deal would mean unemployment rising further, peaking at 2.8 million in July to September next year and staying higher for longer than under its central projection. With no deal, the OBR expects unemployment to stay above 2 million until the first three months of 2024 compared to a year earlier with a trade deal.

With unemployment set to stay at relatively high levels for a number of years, there is a clear need for the Government to institute policies to address this, and particularly to tackle long term unemployment. The announcement of the £2.9 billion Restart programme in the November Spending Review is thus to be welcomed. The details of the programme have yet to be set out. To be effective it must learn from past evidence as to what works: offering a wide range of services which can be flexed and personalised so that the programme addresses individuals' particular needs and ensuring that all can benefit from the programme via a set of minimum universal support services.

Paul Bivand, associate director for statistics and analysis at Learning and Work Institute, said:

The Office for National Statistics have been trying to keep us informed through difficult circumstances. They have been working with a range of other providers to deliver information that is as high quality as feasible. Nevertheless, the nature of the responses, particularly the Coronavirus Job Retention Scheme that keeps people in employment while, for some, no actual work is possible, has led to some confusion. The fall in self-employment, together with the rise in employee numbers, partly reflects people re-defining their status in the same employment.

Employment fell by 144,000 between May 2019 to July 2020 and August 2020 to October 2020. In the last 12 months employment fell by 280,000.

Unemployment increased by 241,000 between May 2019 to July 2020 and August 2020 to October 2020, and the unemployment rate increased by 0.6 percentage points to 4.9% in the quarter. The experimental weekly figures have been above 5.0% through October.

Economic inactivity (16-64) fell by 2,000 between May 2019 to July 2020 and August 2020 to October 2020, and the inactivity rate was unchanged at 20.8% in the quarter.

The national claimant count has risen by 64,300. The 'count date' for the claimant count was the 12th of November, early in the second lockdown.

Self-employment fell by 183,000 this quarter. The number of employees increased by 39,000 in the quarter. Involuntary part-time employment increased by 70,000 this quarter to 0.9 million, 11.9% of all part-time workers. The proportion remains much higher than the 7.4% in 2004.

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If you have any questions, contact Paul Bivand
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