Labour market overview, UK: August 2022

The Office for National Statistics (ONS) has published its latest Labour market overview indicating changes in employment for the United Kingdom.

The UK employment rate for people aged 16 to 64 years decreased by 0.1 percentage points on the quarter to 75.5%, and is still below pre-coronavirus (COVID-19) pandemic levels. However, the number of people in employment aged 16 years and over increased on the quarter by 160,000. The number of full-time employees increased during the latest three-month period. While part-time employees had generally been increasing since the beginning of 2021, showing recovery from the large falls in the early stages of the coronavirus pandemic, there was a decrease during the latest three-month period. The number of self-employed workers fell in the first year of the pandemic and has remained low, although the number has increased slightly during the latest three-month period.

The most timely estimate of payrolled employees for July 2022 shows a monthly increase, up 73,000 on the revised June 2022 figures, to a record 29.7 million.

The unemployment rate for April to June 2022 increased by 0.1 percentage points on the quarter to 3.8%. The number of people unemployed for up to 12 months increased during the latest three-month period, with those unemployed for between 6 and 12 months increasing for the first time since February to April 2021. This increase was partially offset by a decrease in those unemployed for over 12 months.

The economic inactivity rate was unchanged on the quarter at 21.4% in April to June 2022. The increase in economic inactivity since the start of the coronavirus pandemic had been largely driven by those who were students and the long-term sick. In the latest three-month period, there was an increase in the number of people who were economically inactive owing to long-term sickness, which was largely offset by a decrease in those economically inactive for “other” reasons.

The number of job vacancies in May to July 2022 was 1.274 million; a decrease of 19,800 from the previous quarter and the first quarterly fall we have seen since June to August 2020. Since vacancies fell to an all-time low in April to June 2020, they have increased by 945,000 in a little over two years.

Growth in employees’ average total pay (including bonuses) was 5.1% and growth in regular pay (excluding bonuses) was 4.7% in April to June 2022. In real terms (adjusted for inflation), over the year, total pay fell by 2.5% and regular pay fell by a record 3.0%. Note, [ONS] are comparing the latest period with a period where certain sectors (accommodation and food service activities, and wholesale and retail) had employees on furlough as a result of the winter 2020 to 2021 lockdown. Therefore, a small amount of base effect will be present for these sectors, but not to the degree we saw when comparing with periods at the start of the coronavirus (COVID-19) pandemic.

PAYadvice.UK 17/8/2022

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