3. Analysis of the labour market

Employment

Figure 1: Employment rate for women was 72.0%, the joint-highest on record UK employment rates (aged 16 to 64 years), seasonally adjusted, January to March 1971 to March to May 2019 Source: Office for National Statistics – Labour Force Survey Download this chart Figure 1: Employment rate for women was 72.0%, the joint-highest on record Image .csv .xls

Employment measures the number of people aged 16 years and over in paid work. The employment rate is the proportion of people aged from16 to 64 years who are in paid work.

Estimated employment rates for men and women aged from 16 to 64 years have been generally increasing since early 2012. For March to May 2019, the estimated employment rate:

for everyone was 76.0%, higher than a year earlier (75.6%); on the quarter, the rate was 0.1 percentage points lower, the first quarterly decrease since June to August 2018

for men was 80.2%; slightly higher than a year earlier (80.1%)

for women was 72.0%, the joint highest since comparable records began in 1971

The increase in the employment rate for women in recent years is partly because of changes to the State Pension age for women, resulting in fewer women retiring between the ages of 60 and 65 years.

Estimates for March to May 2019 show 32.75 million people aged 16 years and over in employment, 354,000 more than for a year earlier. This annual increase of 354,000 was mainly as a result of more people working full time (up 247,000 on the year to reach 24.09 million). Part-time working also showed an increase of 107,000 on the year to reach 8.66 million.

More information about employment can be found in the Employment in the UK bulletin, published alongside this release.

Unemployment

Figure 2: Unemployment rates have been generally falling for the last five years UK unemployment rates (aged 16 years and over), seasonally adjusted, January to March 1971 to March to May 2019 Source: Office for National Statistics – Labour Force Survey Download this chart Figure 2: Unemployment rates have been generally falling for the last five years Image .csv .xls

Unemployment measures people without a job who have been actively seeking work within the last four weeks, and are available to start work within the next two weeks. The unemployment rate is the proportion of all employed and unemployed people (not the proportion of the total population) who are unemployed.

Estimated unemployment rates for both men and women aged 16 years and over have been generally falling since late 2013.

For March to May 2019, the estimated unemployment rate:

for everyone was 3.8%; it has not been lower since October to December 1974

for men was 4.0%, slightly lower than a year earlier (4.2%)

for women was 3.6%, the lowest since comparable records began in 1971

For March to May 2019, an estimated 1.29 million people were unemployed, 116,000 fewer than a year earlier and 820,000 fewer than five years earlier.

Looking in more detail at this fall of 820,000 unemployed people over the last five years:

people unemployed for up to six months fell by 246,000 to 766,000

people out of work for between 6 and 12 months fell by 160,000 to 187,000

the largest fall was for people unemployed for over one year (down 414,000 to 340,000)

More information about unemployment can be found in the Employment in the UK bulletin, published alongside this release.

Economic inactivity

Figure 3: Economic inactivity rate for women has fallen to a record low of 25.3% UK economic inactivity rates (aged 16 to 64 years), seasonally adjusted, January to March 1971 to March to May 2019 Source: Office for National Statistics – Labour Force Survey Download this chart Figure 3: Economic inactivity rate for women has fallen to a record low of 25.3% Image .csv .xls

Economic inactivity measures people without a job but who are not classed as unemployed because they have not been actively seeking work within the last four weeks and/or they are unable to start work within the next two weeks. Our headline measure of economic inactivity is for those aged from 16 to 64 years.

Since comparable records began in 1971, the economic inactivity rate for all people aged from 16 to 64 years has been generally falling (although it increased during recessions). This is because of a gradual fall in the economic inactivity rate for women.

For people aged from 16 to 64 years, for March to May 2019, the estimated economic inactivity rate:

for all people was 20.9%

for men was 16.4%

for women was 25.3%

Estimates for March to May 2019 showed 8.62 million people aged from 16 to 64 years not in the labour force (economically inactive). This was 43,000 fewer than a year earlier, and 307,000 fewer than five years earlier.

More information about economic inactivity can be found in the Employment in the UK bulletin, published alongside this release.

Earnings growth

Figure 4: Pay for employees (including bonuses) increased by 1.4% on the year when adjusted for inflation; pay excluding bonuses increased by 1.7% Great Britain average weekly earnings annual growth rates, seasonally adjusted, January to March 2001 to March to May 2019 Source: Office for National Statistics – Monthly Wages and Salaries Survey Download this chart Figure 4: Pay for employees (including bonuses) increased by 1.4% on the year when adjusted for inflation; pay excluding bonuses increased by 1.7% Image .csv .xls

The earnings estimates are not just a measure of pay rises as they also reflect changes in the number of paid hours worked and changes in the structure of the workforce; for example, more high-paid jobs would have an upward effect on earnings growth rates.

Pay in real terms is calculated as nominal average weekly earnings, deflated by the Consumer Prices Index including owner occupiers’ housing costs (CPIH).

Annual growth in total pay (including bonuses) and regular pay (excluding bonuses) accelerated by 0.2% in March to May 2019 when compared with February to April 2019.

Two contributing factors were introduced in April that have a greater potential impact this reporting period: pay increases for some NHS staff, which will affect public sector pay growth, and the introduction of the new National Living Wage rate (4.9% higher than the 2018 rate) and National Minimum Wage rates. This will affect the lowest paid workers in sectors such as wholesaling, retailing, hotels and restaurants.

For May 2019, average regular pay, before tax and other deductions, for employees in Great Britain was estimated at £503 per week in nominal terms and £468 per week in real terms (constant 2015 prices). This is higher than the estimate for a year earlier (£460 per week), but £5 (1.0%) lower than the pre-recession peak of £473 per week for April 2008.

The equivalent figures for total pay are £498 per week in May 2019 and £525 in February 2008, a 5.0% difference.

More information about earnings growth can be found in the Average weekly earnings in Great Britain bulletin, published alongside this release.

Vacancies

Figure 5: The number of vacancies in the UK has been generally increasing since 2012 although it has been falling since early 2019 Number of vacancies in the UK, seasonally adjusted, April to June 2001 to March to May 2019 Source: Office for National Statistics – Vacancy Survey Download this chart Figure 5: The number of vacancies in the UK has been generally increasing since 2012 although it has been falling since early 2019 Image .csv .xls

The estimated number of vacancies in the UK fell sharply during the recession of 2008 to 2009. Since 2012, it has generally increased although it has been falling since early 2019. For April to June 2019, there were an estimated 827,000 vacancies in the UK, 9,000 fewer than a year earlier and 19,000 fewer than for the previous quarter (January to March 2019).

More information about vacancies can be found in the Vacancies and jobs in the UK bulletin, published alongside this release.