Employment in the UK: August 2023

Other commentary from the latest labour market data can be found on the following pages:

• Average weekly earnings in Great Britain

• Earnings and employment from Pay As You Earn Real Time Information, UK

• Labour market in the regions of the UK

• Labour market overview

• Public sector employment, UK

• Vacancies and jobs in the UK

• Estimates for April to June 2023 show decreases in the employment and economic inactivity rates compared with the previous quarter (January to March 2023), while the unemployment rate increased.

• The UK employment rate was estimated at 75.7%, 0.1 percentage points lower than the previous quarter and 0.8 percentage points lower than before the coronavirus (COVID-19) pandemic (December 2019 to February 2020).

• The UK unemployment rate was estimated at 4.2%, 0.3 percentage points higher than the previous quarter and 0.2 percentage points above pre-coronavirus pandemic levels.

• The UK economic inactivity rate was estimated at 20.9%, 0.1 percentage points lower than the previous quarter and 0.7 percentage points higher than before the coronavirus pandemic.

• Total hours worked decreased compared with the previous quarter and are now below pre-coronavirus pandemic levels again.

Latest Labour Force Survey (LFS) estimates are based on interviews that took place from April to June 2023.

Because of coronavirus (COVID-19) and the suspension of face-to-face interviewing, we had to make operational changes to the LFS, which moved to a by-telephone approach. This introduced an increased non-response bias to the survey, which was partially mitigated by the introduction of housing tenure-based weights into the survey in October 2020, as detailed in Coronavirus and its impact on the Labour Force Survey.

However, it was acknowledged that further improvement work was required to deal with the increase in non-response from those with a non-UK country of birth or nationality. As a result, in July 2021 we introduced our new Labour force Survey weighting methodology. Further information is available in our Impact of reweighting on Labour Force Survey key indicators: 2022 article.

The population totals used for the latest LFS estimates use projected growth rates from Real Time Information (RTI) data for EU and non-EU populations based on 2021 patterns. Therefore, the total population used for the LFS does not take into account any changes in migration, birth rates, death rates and so on since June 2021. As a result, levels estimates may be under or over-estimating the true values and should be used with caution. Estimates of rates will, however, be robust.

We are planning to reweight the LFS published data, using more up-to-date population estimates, drawing on the latest census data, alongside our labour market release in October 2023. We intend to publish indicative estimates of the reweighted LFS in an article publishing in September 2023.

Figure 1: April to June 2023 estimates show decreases in the employment and economic inactivity rates, while the unemployment rate increased

UK employment, unemployment, and economic inactivity rates, seasonally adjusted, between April to June 2008 and April to June 2023

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Flows estimates show that, between January to March 2023 and April to June 2023, the net movement from employment to economic inactivity was the largest since October to December 2020 (Figure 2). This was driven by fewer people moving from economic inactivity into employment. Those moving out of economic inactivity largely moved into unemployment, with the largest net movement from economic inactivity into unemployment since July to September 2020. This suggests it is taking longer for those leaving economic inactivity to find jobs in this period compared with recent periods.

Additionally, job-to-job flows have fallen from their recent peak. While they continue to be driven by resignations, job-to-job flows because of redundancies have increased to the highest level since October to December 2022.

Figure 2: Flows estimates show there was a large net movement from economic inactivity into unemployment in the latest quarter

UK flows between employment, unemployment, and economic inactivity, people aged 16 to 64 years, seasonally adjusted, between January to March 2023 and April to June 2023

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During the first year of the coronavirus (COVID-19) pandemic, there was a decrease in the employment rate and increases in the economic inactivity and unemployment rates for both men and women.

In the latest quarter, the decreases in the employment and economic inactivity rates, and the increase in the unemployment rate were driven by both men and women (Figure 3).

Following an increase in the employment rate since early 2012, the rate decreased from the start of the coronavirus (COVID-19) pandemic. There has largely been an increase since the end of 2020, however in the latest quarter, employment rate decreased and remains below pre-coronavirus pandemic levels.

The number of full-time employees decreased during the latest quarter but is still above pre-coronavirus pandemic levels. Part-time employees had generally been decreasing since the beginning of 2022, however they saw an increase during the latest quarter. The number of self-employed workers fell in the first year of the coronavirus pandemic, and both full-time and part-time self-employed workers decreased in the latest quarter (Figure 4).

The number of people in employment with second jobs fell in the early stages of the coronavirus pandemic, but steadily increased thereafter. In the latest quarter, however, the number fell to 1.17 million (3.6% of people in employment).

Hours worked

Total actual weekly hours worked in the UK have been generally increasing since the relaxation of COVID-19 lockdown measures. In the latest quarter, total actual weekly hours worked decreased by 5.6 million hours to 1.05 billion hours in April to June 2023 (Figure 5). This is 5.8 million hours below pre-coronavirus pandemic levels (December 2019 to February 2020).

The decrease in the latest quarter was driven by both men and women. The total weekly hours worked by women is above pre-coronavirus pandemic levels, while the total actual weekly hours worked by men remains below pre-coronavirus pandemic levels.

After falling sharply in the early stages of the coronavirus pandemic, average actual weekly hours worked have now returned to levels similar to those seen before the pandemic, but decreased in the latest quarter. The actual weekly hours worked in April to June 2023 have been affected by the additional bank holiday in May 2023. Average actual weekly hours worked have also been affected recently by the additional bank holidays in the summer and autumn of 2022, and by strikes in recent periods.

The unemployment rate had generally been falling from late 2013 until the start of the coronavirus (COVID-19) pandemic. Thereafter it increased until the end of 2020 but had returned to pre-coronavirus pandemic rates. However, the unemployment rate has increased in the latest quarter, with the largest quarterly increase since August to October 2021.

In the latest quarter, the number of people unemployed for up to 6 months increased, with the largest increase since August to October 2022. This increase, alongside the labour market flows data presented above, suggests that it is taking longer for those leaving economic inactivity to find work than in recent periods. Those unemployed for between 6 and 12 months also increased, while those unemployed for over 12 months decreased (Figure 6).

Since comparable records began in 1971, the economic inactivity rate had generally been falling; however, it increased during the coronavirus (COVID-19) pandemic. It decreased in April to June 2023 compared with the previous quarter.

Increases in economic inactivity in the first year of the coronavirus pandemic were largely driven by those aged 16 to 24 years, while more recent increases were driven by those aged 50 to 64 years (Figure 7). The decrease in the latest quarter (April to June 2023) was largely driven by those aged 50 to 64 years.

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 (Figure 8).

The decrease in economic inactivity during the latest quarter (April to June 2023) was largely driven by those inactive because they were looking after family or home. Meanwhile, those inactive because they were long-term sick increased to a record high, and those inactive because they were students also increased.

In April to June 2023, the number of people reporting redundancy in the three months prior to interview increased by 0.9 per thousand employees compared with the previous quarter, to 3.8 per thousand employees (Figure 9).

We now publish a dataset showing potential redundancies, covering those notified by employers to the Insolvency Service through the HR1 form, broken down by region and industry, as shown in our HR1: Potential redundancies dataset.

Actual and usual hours worked

Statistics for usual hours worked measure how many hours people usually work per week. Compared with actual hours worked, they are not affected by absences and so can provide a better measure of normal working patterns. For example, a person who usually works 37 hours a week but who was on holiday for a week would be recorded as working zero actual hours for that week, while usual hours would be recorded as 37 hours. For more information on usual and actual hours worked, see Section 4 of A guide to labour market statistics methodology.

Workers temporarily absent from a job as a result of the coronavirus (COVID-19) pandemic would still be classed as employed; however, they would be employed working no hours. This has directly affected estimates of total actual hours worked during the coronavirus pandemic. Since the average actual weekly hours are the average of all in employment, those temporarily absent from a job also affected these estimates.

Claimant Count

The Claimant Count is an Experimental Statistic that measures the number of people who are receiving a benefit principally for the reason of being unemployed. Currently the Claimant Count consists of those receiving Jobseekers’ Allowance, and Universal Credit claimants in the “searching for work” conditionality group.

Economic inactivity

People not in the labour force (also known as economically inactive) are not in employment but do not meet the internationally accepted definition of unemployment because they have either not been seeking work within the last four weeks or are unable to start work in the next two weeks, or both. The economic inactivity rate is the proportion of people aged between 16 and 64 years who are not in the labour force. For more information on economic inactivity, see Section 6 of A guide to labour market statistics methodology.

Employment

Employment measures the number of people in paid work or who had a job that they were temporarily away from (for example, because they were on holiday or off sick). This differs from the number of jobs because some people have more than one job. The employment rate is the proportion of people aged between 16 and 64 years who are in employment.

Workers furloughed under the Coronavirus Job Retention Scheme (CJRS), or those who were self-employed but temporarily not in work, had a reasonable expectation of returning to their jobs after a temporary period of absence. Therefore, they were classified as employed under the International Labour Organization (ILO) definition.

A more detailed explanation of employment is available in Section 3 of A guide to labour market statistics methodology.

Redundancies

The redundancy estimates measure the number of people who were made redundant or who took voluntary redundancy in the three months before the Labour Force Survey interviews; it does not take into consideration planned redundancies.

Unemployment

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 not the proportion of the total population that is unemployed. It is the proportion of the economically active population (that is, those in work plus those seeking and available to work) that is unemployed. For more information on unemployment, see Section 9 of A guide to labour market statistics methodology.

A more detailed glossary is available.

This bulletin relies on data collected from the Labour Force Survey (LFS), the largest household survey in the UK.

More quality and methodology information on strengths, limitations, appropriate uses, and how the data were created is available in our LFS Quality and Methodology Information (QMI) report.

The LFS performance and quality monitoring reports provide data on response rates and other quality-related issues for the LFS.

Coronavirus (COVID-19)

For more information on how labour market data sources are affected by the coronavirus pandemic, see our Coronavirus and the effects on UK labour market statistics article.

For a comparison of our labour market data sources and the main differences, see our Comparison of labour market data sources methodology.

Making our published spreadsheets accessible

Following the Government Statistical Service (GSS) guidance on releasing statistics in spreadsheets, we will be amending our published tables over the coming months to improve usability, accessibility and machine readability of our published statistics. To help users change to the new formats, we will be publishing sample versions of a selection of our tables, and where practical, initially publish the tables in both the new and current formats. If you have any questions or comments, please email labour.market@ons.gov.uk.

Occupational data in ONS surveys

On 18 July 2022, the Office for National Statistics (ONS) announced an issue with the collection of some occupational data. On 26 September 2022, we informed users of the impact of the coding error in our Impact of miscoding of occupational data article. We have undertaken a recoding exercise to correct the error and have revised affected Labour Force Survey (LFS) estimates alongside this release. For more detail on the new methodology used and its impact, see our Revision of miscoded occupational data in the ONS Labour Force Survey, UK article, published on 11 July at 9:30.

We have updated the Annual Population Survey estimates published on Nomis alongside the August labour market release.

Uncertainty in these data

The estimates presented in this bulletin contain uncertainty. For more information on uncertainty, see our Uncertainty and how we measure it for our surveys webpage.

The figures in this bulletin come from the Labour Force Survey (LFS), which gathers information from a sample of households across the UK rather than from the whole population. The sample is designed to be as accurate as possible, given practical limitations. Results from sample surveys are always estimates, not precise figures. This can have an impact on how changes in the estimates should be interpreted, especially for short-term comparisons. For more information on sampling, see Section 2 of our Uncertainty and how we measure it for our surveys webpage.

As the sample gets smaller, the variability of the estimates gets larger. Estimates for small groups, which are based on small subsets of the LFS sample, are less reliable and tend to be more volatile than for larger aggregated groups.

In general, changes in the numbers (and especially the rates) reported in this bulletin between quarters are small and are not usually greater than the level that can be explained by sampling variability. Short-term movements in reported rates should be considered alongside longer-term patterns in the series and corresponding movements in other sources to give a fuller picture.

Information on the quality of estimates is available in our Labour Force Survey sampling variability dataset.

Comparability

The data in this bulletin follow internationally accepted definitions specified by the International Labour Organization (ILO). This ensures that the estimates for the UK are comparable with those for other countries.

Our annual reconciliation report of job estimates article compares the latest workforce jobs series estimates with the equivalent estimates of jobs from the LFS. It is usually published in March each year following the benchmarking of Workforce Jobs.

Further information is available in A guide to labour market statistics methodology.