This morning, the Office for National Statistics published the monthly Labour Market Statistics (LMS) release for August 2013. This contains Labour Force Survey data for the period April to June 2013 and Jobseeker’s Allowance (JSA) claimant count data for July 2013. As in the case of the last two months’ LMS, this month’s data is fairly flat, with a slight increase in the employment rate but no change in the rate of unemployment compared to the previous quarter. The more timely Claimant Count unemployment has fallen slightly, for the second consecutive month.
Compared to the same period a year earlier, a number of these headline measures have started to indicate more significant improvements in labour market conditions. There are now 301,000 more individuals employed than a year ago in the UK, and 49,000 fewer individuals unemployed. The economically inactive population (describing individuals who are neither employed nor unemployed, such as full-time carers, students, and the long-term workless who have given up looking for jobs) has fallen by 105,000 compared to the same period a year ago.
However, earnings growth remains very weak, and significantly lower than the rate of inflation (2.8% on the CPI measure in July). Total pay (including bonuses) is estimated to have increased by 2.1% since April to June 2012, whilst regular pay (excluding bonuses) is estimated to have increased by only 1.1%.
An Expert Opinion piece published by NTU today looks at trends in male and female unemployment since the onset of recession in 2008. This suggests that, although unemployment for both men and women increased significantly between 2008 and 2010, male unemployment subsequently recovered whilst female unemployment has continued to increase for much of the period up to spring 2013.
This has been particularly notable in the East Midlands, where the rate of unemployment for women (for the period April 2012-March 2013) now slightly exceeds that of men, at 7.8% compared to 7.6%. Women currently make up 47% of the total number of unemployed adults in the East Midlands, up from 42% before the onset of recession, which is significantly higher than the female share of total unemployment in the UK overall.
This is likely to be affected by the differing sectoral distribution of male and female employment. Male employment is relatively evenly distributed across the 6 largest sectors (including construction, manufacturing, and financial & business services) whilst female employment is highly concentrated in just 2 broad sectors, public services (accounting for almost half of all employed women in the East Midlands) and distribution, hotels and restaurants (including retail). These two areas are likely to have been significantly more affected by public sector cuts and the squeeze on household incomes than other sectors, contributing to the differing experiences of men and women in the labour market.
Unemployment and Employment Rates
LFS data for the three months to June 2013 indicates that the unemployment rate was unchanged from the previous quarter (January to March 2013) at 7.8% of the economically active population aged 16 and over. The number unemployed fell slightly on the previous quarter, by 4,000, and more significantly on the same period a year earlier, by 49,000. The total number of adults currently estimated to be unemployed is 2.51 million.
The numbers of long-term unemployed have increased on a number of measures. The number of adults unemployed for six months to a year has increased slightly, by 1,000, but the numbers unemployed for over a year and for over two years have increased more significantly, from 7,000 and 10,000 respectively compared to the previous quarter.
The employment rate (for adults aged 16-64) for April to June 2013 has increased very slightly on the previous quarter, by 0.1 percentage points to 71.5%. Compared to the same period a year ago, the rate has increased by 0.4 percentage points. The total number of people in employment was 29.8 million, up 69,000 from the previous quarter and 301,000 on the same period a year earlier. That this has not resulted in a more significant an increase in the employment rate (those employed as a percentage of the total working age population) is due to the continuing strong growth in the total size of the UK working-age population.
Earnings growth remains weak and below the rate of inflation. Total pay (including bonuses) increased by 2.1% between April-June 2012 and April-June 2013, whilst regular pay (excluding bonuses) increased by 1.1%.
Job Seekers’ Allowance Claimants
The number of Jobseekers’ Allowance (JSA) claimants in July 2013 fell on the previous month, by 29,200, whilst the rate was down 0.1 percentage points to 4.3% (and down 0.4 percentage points on the same month a year earlier).
Redundancies and Vacancies
In the three months to June 2013, 123,000 people were made redundant, down 17,000 from the previous quarter and down 28,000 from the same period a year earlier.
The number of vacancies (advertised through Jobcentre Plus) in the period May to July 2013 increased by 19,000 on the previous quarter to total 533,000. The number of ILO unemployed adults to every one vacancy in the three months to June 2013 was 4.7, down 0.3 percentage points on the previous quarter.
Key Regional Developments
- Unemployment rates and levels fell compared to the previous quarter in the Yorkshire and the Humber, the East of England, South East and South West. The most significant falls were estimated to be in the South East, with a fall in unemployment of 25,000 individuals and 0.6 percentage points. The South East has the lowest unemployment rate of the nine English regions, at 6%.
- However, unemployment increased significantly on the previous quarter in the West Midlands, by 18,000 individuals and 0.7 percentage points, to a rate of 9.9%. This remains below the rate of unemployment in the North East, at 10.3%.
- In the East Midlands, unemployment has increased very slightly, by 4,000 individuals and 0.1 percentage points compared to the previous quarter. The unemployment rate in the East Midlands for April to June 2013 is estimated to be 7.9% of economically active adults (equivalent to 181,000 individuals), which slightly exceeds the UK average of 7.8%.
- The employment rate in the East Midlands has also increased, by 8,000 individuals and 0.4 percentage points, to a rate of 71.2%, below the UK average of 71.5%.
- It is possible for both the employment and the unemployment rates to increase at the same time because the number of economically inactive adults (neither employed nor unemployed) has fallen - by 15,000 individuals compared to the previous quarter. This could be due to individuals who had previously been full-time carers of children or elderly relatives starting to look for work, with national research suggesting that the continued squeeze on household incomes and the impact of benefit changes has particularly affected women.
 According to the International Labour Organisation (ILO), this is defined as those who are out of work but available for, and actively looking for, employment within a set period. This is expressed as the proportion of ‘economically active’ (employed plus unemployed) adults.