Search

PDF version available for download (PDF help)

Labour Market Report

Number 11 January 2011

Employment

The most recent labour market data relate to the period September - November 2010, and show that employment levels fell on the quarter (69,000) and on the month (36,000).

Men and women have both lost jobs in the recession and both saw further falls in the latest figures. More men lost jobs during the recession and women's employment began to recover earlier, but the recent trend has been for women's employment to be harder hit. Male employment fell by 14,000 between Jun - Aug and Sep - Nov; but for women the drop was 54,000. Men's and women's employment rates both fell 0.2 percentage points in the latest figures. Since April 2008, women's rate has fallen by 1.9 points and men's by 3.4. This means that, over the course of the recession the employment rate gap has fallen by 1.5 points, but this overall figure disguises the recent shift:

Redundancies and vacancies

There were 157,000 redundancies in the three months to November, and increase of 14,000 on the quarter. In the three months to December, there were 480,000 job vacancies, an apparent increase of 18,000 from the three months to September which the Prime Minister the Minister for employment both drew attention to. Unfortunately, (as the DWP's press release had pointed out) this increase was entirely due to the census, which began recruiting temporary staff in October.Once these vacancies are removed there were 456,000 vacancies, a decrease of 6,000 from the three months to September 2010.

Atypical employment

Despite strong growth earlier in the year, the number of employee jobs fell on the quarter (64,000) and the month (42,000). Levels have been falling since June (a drop of 83,000 between June and October). While male employee jobs increased between July - September (and showed a small fall of 9,000 between September to October), female employee jobs have been falling consistently since Summer.

Self-employment saw a small quarterly rise (9,000), which was mainly accounted for by a monthly increase of 8,000. Since June, self-employment levels have increased by 19,000. The number of people working full-time has fallen by 9,000 on the month and 37,000 on the quarter. While the start of 2010 saw large rises in part-time work, levels of part-time employment also fell on the month (27,000) and the quarter (32,000). Involuntary part-time and temporary work is also extremely high. 15 per cent of part-time workers are now unable to find full-time work (the highest rate since records began since 1992, and 0.9 percentage points higher than the rate reached during the 1990s), and 37.5 per cent of temporary staff are seeking permanent employment (a slight reduction on Augusts' rate of 38.4 per cent, and comparable with the rates of involuntary temporary work that were seen in the late 1990s).

The recession has accelerated the trend towards greater part-time and self-employed work, and that full-time and employee employment levels have yet to show any signs of recovery from the downturn.

Employee and full-time employment (000s) (LHS) and part-time and self-employment (RHS) (000s) April 1992 - October 2010

Inactivity

The latest statistics show a very sharp monthly rise in economic inactivity (83,000). On the quarter, inactivity increased by 89,000. Women's economic inactivity levels rose 55,000 on the month and 77,000 on the quarter, compared to lower rises of 28,000 (monthly) and 11,000 (quarterly) for men. The largest increase was in workers stating that they had retired (a 39,000 quarterly rise). There was also a large quarterly rise of 43,000 in workers who gave the reason for their inactivity as 'other' than the list of stated reasons (which includes looking after a home or family, sickness and studying etc.) suggesting that while people may have recently left the labour market and have not actively sought work over the last two weeks (the basis of the ILO definition of unemployment) they are likely to be effectively unemployed.

Unemployment

Unemployment levels remain high with 2,498,000 people out of work by the ILO measure. While the figures increased by 49,000 on the quarter monthly data shows a small fall (4,000). Claimant unemployment (which is a month ahead of the ILO measure) also showed a small reduction of 4,100 between November to December 2010.

The latest statistics showed the unemployment rate for under-25s rising 1.0 percentage points to 20.3, the highest rate since 1992. The unemployment level for this age group rose by 32,000 to 951,000, also the highest since the current records began. The number of economically inactive young people also rose, by 66,000 to 2,656,000.

Long-term youth unemployment fell very slightly, with 401,000 young people unemployed over 6 months, down from 402,000 in the previous month's figures. The number unemployed over 12 months rose by the same amount, to 229,000. The Department for Work and Pensions also released the latest statistics for the Future Jobs Fund, showing that, up to October, there had been 75,310 starts in FJF vacancies. At the same time they published an Early Analysis of Future Jobs Fund participant outcome. This showed that 50 per cent of participants were on benefits a month after their 6 month placement finished, with many of the rest having left to employment on the open labour market. The analysis suggests that the programme has achieves better employment outcomes for disadvantaged young people than would have been the case had they faced an additional six months of unemployment.

Pay

January's inflation figures showed inflation in the year to December was 3.7 per cent using the government's preferred Consumer Prices Index, 4.8 per cent using the Retail Prices Index normally preferred by union negotiators.

Total pay - including bonuses - rose by 2.1 per cent in the year to November, whilst regular pay (excluding bonuses rose by 2.3 per cent.

Earnings growth varied a great deal by industry - total pay rose 4.2 per cent in finance and business services and 3.5 per cent in manufacturing, but just 1.2 per cent in wholesale, retail, hotels and restaurants and 2.2 per cent in the public sector excluding finance.

Report (1,100 words) issued 21 Jan 2011