Employment in the UK: August 2020

Estimates of employment, unemployment and economic inactivity for the UK.

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Corrections

24 August 2020 09:04

A minor error had occured in figure 2 of this release where the scale has been labelled as % instead of thousands. This has now been corrected.

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Notices

11 August 2020

The effect of the coronavirus (COVID-19) pandemic on our capacity means we have reviewed the existing labour market releases and suspended some publications.

This will protect the delivery and quality of our remaining labour market outputs as well as ensuring we can respond to new demands as a direct result of the coronavirus. More details about the impact on labour market outputs can be found in our statement.

This is an accredited National Statistic. Click for information about types of official statistics.

Cyswllt:
Email Bob Watson

Dyddiad y datganiad:
11 August 2020

Cyhoeddiad nesaf:
15 September 2020

1. Other pages in this release

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

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2. Main points for April to June 2020

  • April to June figures show weakening employment rates, with numbers of self-employed and part-time workers seeing reductions; despite these falls, unemployment is not rising, because of increases in people out of work but not currently looking for work.

  • The reduction in total hours worked is at record levels both on the year and the quarter, with the whole April to June period covering a time since the introduction of coronavirus (COVID-19) measures.

  • The UK employment rate was estimated at 76.4%, 0.3 percentage points higher than a year earlier but 0.2 percentage points down on the previous quarter.

  • The UK unemployment rate was estimated at 3.9%, largely unchanged on the year and the previous quarter.

  • The UK economic inactivity rate was estimated at 20.4%, 0.4 percentage points lower than the previous year but 0.2 percentage points up on the previous quarter.

  • The total number of weekly hours worked was 849.3 million, down a record 203.3 million hours on the previous year and down 191.3 million hours on the previous quarter.

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The data in this bulletin come from the Labour Force Survey, a survey of households. It is not practical to survey every household each quarter, so these statistics are estimates based on a large sample.

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3. Coronavirus and measuring the labour market

Latest Labour Force Survey estimates are based on interviews that took place from the start of April to the end of June 2020. Interviews during the whole of April, May and June relate to the period following the start of lockdown and government measures aimed at protecting businesses and jobs during the coronavirus (COVID-19) pandemic.

The International Labour Organization (ILO) definition of employment includes those who worked in a job for at least one hour and those temporarily absent from a job. Workers furloughed under the Coronavirus Job Retention Scheme or who are self-employed but temporarily not in work have a reasonable expectation of returning to their jobs after a temporary period of absence. Therefore they are classified as employed under the ILO definition.

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4. Employment

Employment measures the number of people aged 16 years and over in paid work and those who had a job that they were temporarily away from. The employment rate is the proportion of people aged between 16 and 64 years who are in employment.

Estimated employment rates for people aged between 16 and 64 years had generally been increasing since early 2012, largely driven by increases in the employment rate for women (Figure 1). The recent decreases in employment rates have been driven by men, with the rate for women also showing some decline.

For April to June 2020:

  • the estimated employment rate for all people was 76.4%; this is 0.3 percentage points up on the year but 0.2 percentage points down on the quarter

  • the estimated employment rate for men was 80.2%; largely unchanged on the year and 0.3 percentage points down on the quarter

  • the estimated employment rate for women was 72.8%; this is 0.7 percentage points up on the year but 0.1 percentage points down on the quarter

Imputation used for the Labour Force Survey (LFS) was not designed to deal with the changes experienced in the labour market in recent months. Experimental work with adjusted methodology suggests the use of the existing methodology has little impact on the employment rate (less than 0.1 percentage points). Further information can be found in the section on Measuring the data.

Experimental estimates based on returns for individual weeks suggest that the employment rate remained steady through June. Further details of the experimental weekly figures can be found in the Single-month and weekly Labour Force Survey estimates bulletin.

The increase in the employment rate for women in recent years is partly a result of changes to the State Pension age for women, resulting in fewer women retiring between the ages of 60 and 65 years. However, since the equalisation of the State Pension age, the employment rate for women had continued to rise prior to the impact of the coronavirus (COVID-19).

Estimates for April to June 2020 show 32.92 million people aged 16 years and over in employment, 113,000 more than a year earlier (the smallest annual increase since March to May 2012). This annual increase was mainly driven by women in employment (up by 157,000 on the year to 15.71 million).

Employment decreased by 220,000 on the quarter. This is the largest quarterly decrease since May to July 2009. Both men and women in employment decreased on the quarter, by 135,000 and 85,000 respectively. The decrease in men's employment was the largest since July to September 2011.

The quarterly decrease in employment was also driven by workers aged 65 years and over (down by a record 161,000 to 1.26 million), the self-employed (down by a record 238,000 to 4.76 million) and part-time workers (down by a record 364,000). Meanwhile, full-time employees (up by a record 301,000) largely offset the decrease.

Age group

Looking more closely at the decreases in employment over the quarter, those aged 16 to 24 years decreased by 100,000 to 3.72 million, while those aged 65 years and over decreased by a record 161,000 to 1.26 million. This was partially offset by those aged 25 to 64 years, who increased by 41,000 on the quarter to 27.94 million (Figure 2).

Full-time and part-time

The number of full-time workers has continued to increase by 489,000 on the year and 144,000 on the quarter to a record high of 24.6 million. In contrast, the number of part-time workers decreased by a record 377,000 on the year and a record 364,000 on the quarter to 8.3 million (Figure 3).

Employees and self-employed

Looking at the estimates for April to June 2020 by type of employment (Figure 4),the number of self-employed has shown a sharp fall, which is not reflected in employees:

  • there were 28.02 million employees (85.1% of all people in employment), 52,000 more than the previous quarter

  • there were 4.76 million self-employed people (14.5% of all people in employment), a record 238,000 fewer than the previous quarter

These estimates for paid employees and self-employed people make up over 99% of all people in employment in the UK. The total employment figure also includes two other minor categories, as explained in the Guide to labour market statistics.

Looking more closely at the quarterly decrease in men's employment, full-time self-employed men (down by a record 163,000 to 2.50 million) are the main drivers of the decrease (Figure 5). The decrease in women's employment was driven by part-time employee women (down by a record 198,000 to 5.29 million (Figure 5).

While the Labour Force Survey (LFS) estimate of self-employment is showing record decreases, the number of employees in employment continues to increase for April to June 2020, with the number of full-time employees reaching a record high of 21.21 million. Meanwhile, experimental monthly statistics of paid employees from HM Revenue and Customs's (HMRC's) Real Time Information (RTI) data suggest that the number of employees on payroll fell by approximately 198,000 between April and June 2020.

Employment by industry

Looking more closely at the increase in employees over the quarter (Figure 6), the main rises were in public administration, defence and social security (up 143,000 on the quarter, or 6.8%, to 2.26 million) and financial and insurance activities (up 107,000 on the quarter, or 9.2%, to 1.27 million). This was partially offset by employees in accommodation and food service activities, which declined by 137,000, or 8.5%, to 1.48 million.

The decrease in the self-employed over the quarter was driven by construction (down 57,000, or 6.2%, to 862,000), professional, scientific and technical services (down 55,000, or 8.3%, to 610,000) and administrative and support services (down 55,000, or 14.3%, to 333,000).

Public and private sectors

The number reporting employment in the public sector has been increasing since January to March 2018. Between January to March 2020 and April to June 2020, public sector workers increased by 269,000 to a record high of 7.51 million (Figure 7).

The number reporting employment in the private sector had been increasing since April to June 2015, however, this decreased between January to March 2020 and April to June 2020 by 535,000 to 25.22 million. As the distinction between public and private sector in the LFS is based on respondents' views about the organisations for which they work, these movements may in part be the result of changes in self-classification rather than a change in job.

Labour market flows

Labour market flows estimates show the increasing number of employees and decreasing number of self-employed between January to March 2020 and April to June 2020 was driven in part by a movement of people from self-employed to employee status.

Employment status on LFS is self-reported, with people classifying themselves as being either an employee or self-employed. The number of people who changed from reporting themselves as self-employed to an employee increased by 48,000 on the quarter and 81,000 on the year to a record high of 253,000 (Figure 8). Of these, the number who had changed jobs had not increased from normal levels. Consequently some of the fall in self-employment comes from an increase in the number of people who have changed to classifying themselves as an employee, even though they have not changed jobs.

EU and non-EU nationals' employment

Since 2010, the number of non-UK nationals from outside the EU has been largely flat, with a slight increase since October to December 2016. The estimated number of non-UK nationals from outside the EU working in the UK decreased by 84,000 on the quarter in April to June 2020 to 1.27 million (Figure 9).

Meanwhile, the number of non-UK nationals from the EU working in the UK has generally increased since 2010. However, the series had been broadly flat since the latter half of 2016. The estimated number of non-UK nationals from the EU working in the UK also decreased in April to June 2020, by 284,000 on the quarter to 2.06 million. This is the lowest level since October to December 2015.

EU nationals working in the UK make up a higher proportion of the accommodation and food service activities industry than other industries. Figure 6 highlighted this industry as being most affected by coronavirus lockdown measures, and so may provide some explanation for the decrease in the number of EU nationals working in the UK between January to March 2020 and April to June 2020.

Occupations

The National Statistics Socio-economic Classification (NS-SEC) is partially derived from Standard Occupational Classification (SOC) and so can provide an indicator of movements in occupations. Looking more closely at changes in employment over the past year, higher managerial and professional, lower managerial and professional, and intermediate occupations have increased steadily. Meanwhile small employers and own account workers, lower supervisory and technical, semi-routine, and routine occupations decreased.

The largest decrease was in routine occupations, down 325,000 (or 11.3%) on the year and 195,000 (or 7.1%) on the quarter (Figure 10), indicating these occupations have been most affected by coronavirus lockdown measures introduced in March 2020.

Zero-hour contracts

The number of people on zero-hour contracts has been increasing steadily (Figure 11). Since April to June 2019, it has increased by 156,000 (or 17.4%) to a record high of 1.05 million.

Underemployment

Those who are underemployed are those who are willing and available to work more hours, and who currently work less than 40 hours per week (people aged under 18 years) or less than 48 hours per week (people aged 18 years and over). The level of underemployment has increased by 360,000 on the year and 217,000 on the quarter to 2.84 million, the highest level since July to September 2015.

Looking more closely at this increase in underemployment:

  • those wanting more hours in their current job increased by 394,000 on the year and 264,000 on the quarter to 2.37 million, the highest level since January to March 2014

  • those wanting a replacement job with longer hours decreased by 71,000 on the year and 76,000 on the quarter to 217,000

  • those wanting an additional job increased by 36,000 on the year and 29,000 on the quarter to 251,000, the highest level since April to June 2014

Hours worked

Since estimates began in 1971, total hours worked by women had generally increased, reflecting increases in both the employment rate for women and the UK population. In contrast, total hours worked by men had been relatively stable because of falls in the employment rate for men, and increases in the share of part-time working, roughly offset by population increases.

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 directly impacted the total actual hours worked in April to June 2020. Since the average actual weekly hours are the average of all in employment, those temporarily absent from a job also impacted on those estimates.

Between January to March 2020 and April to June 2020, total actual weekly hours worked in the UK decreased by a record 191.3 million, or 18.4%, to 849.3 million hours (Figure 14). This was the largest quarterly decrease since estimates began in 1971, with total hours dropping to its lowest level since September to November 1994. The decrease in total actual weekly hours worked over the quarter was mainly driven by the decrease in men's total hours worked (down a record 113.7 million hours), but there was also a large fall in women's total hours worked (down a record 77.6 million hours).

Average actual weekly hours fell by a record 5.6 hours on the quarter to a record low of 25.8 hours. The average weekly hours worked by men decreased by a record 6.3 hours to a record low of 29.1 hours, while women's hours decreased by a record 4.8 hours to a record low of 22.2 hours.

Experimental estimates based on returns for individual weeks suggest that the average number of weekly hours worked remained low throughout June. Further details of the experimental weekly figures can be found in the Single-month and weekly Labour Force Survey estimates bulletin.

Between April to June 2019 and April to June 2020, average actual weekly hours fell by 6.3 hours. Decreases were observed in all industries apart from agriculture, forestry, and fishing. The largest decrease in average actual weekly hours was in the accommodation and food service activities industry, with a decrease of 15.4 hours to 13.0 hours per week, followed by other services, down 11.0 hours to 18.2 hours per week. Other services are made up of arts, entertainment and recreation, households as employers, and other service activities, including personal service activities. Public administration, defence and social security had the smallest annual decrease, of 1.2 hours, to 31.3 hours per week (Figure 15).

Imputation used for the Labour Force Survey (LFS) was not designed to deal with the changes experienced in the labour market in recent months. Experimental work with adjusted methodology suggests the use of the existing methodology has understated the reduction in the actual numbers of hours worked by approximately 7% to 8%.

Figure 15 shows the industries that have experienced the largest reduction in hours because of the coronavirus are also those where this reduction is most understated. For example, using this adjusted imputation methodology, the hours worked in accommodation and food service activities decrease by a further 4.3 hours compared with the original imputation method, to an average of 8.7 hours a week in April to June 2020. Further information can be found in the section on Measuring the data.

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5. 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 who are unemployed. It is the proportion of the economically active population (those in work plus those seeking and available to work) who are unemployed.

Estimated unemployment rates for both men and women aged 16 years and over have generally been falling since late 2013 but have levelled off in recent periods (Figure 16).

For April to June 2020:

  • the estimated UK unemployment rate for all people was 3.9%; largely unchanged compared with the previous year and the previous quarter

  • the estimated UK unemployment rate for men was 4.1%; this is largely unchanged compared with a year earlier and 0.1 percentage points lower than the previous quarter

  • the estimated UK unemployment rate for women was 3.7%; this is 0.1 percentage points higher than a year earlier and also 0.1 percentage points higher than the previous quarter

Experimental estimates based on returns for individual weeks suggest that the unemployment rate throughout June was broadly consistent with other weeks within the quarter. Further details of the experimental weekly figures can be found in the Single month article.

Imputation used for the Labour Force Survey was not designed to deal with the changes experienced in the labour market in recent months. Experimental work with adjusted methodology suggests the use of the existing methodology has little impact on the unemployment rate (less than 0.1 percentage points). Further information can be found in the section on Measuring the data.

Between April to June 2015 and April to June 2020 (Figure 17):

  • the estimated unemployment rate for all people fell from 5.6% to 3.9%

  • the estimated unemployment rate for men fell from 5.8% to 4.1%

  • the estimated unemployment rate for women fell from 5.4% to 3.7%

For April to June 2020, an estimated 1.34 million people were unemployed, down 10,000 on the quarter. This is 511,000 fewer than five years earlier but 9,000 more than a year earlier. It was mainly driven by unemployed women (up 20,000), unemployed people aged 16 to 24 years (up 41,000) and people who have been unemployed for up to six months (up 150,000). However, this was offset somewhat by people who have been unemployed for over 12 months (down 115,000 to a record low of 227,000).

Looking in more detail at unemployment by age (Figure 18):

  • despite the lack of overall increase in the number of unemployed, the estimated number of people unemployed aged 16 to 24 years increased by 41,000 on the year, and 28,000 on the quarter, to 543,000

  • those unemployed aged 25 to 34 years decreased by 2,000 on the year, and increased by 18,000 on the quarter, to 266,000

  • unemployment for those aged 35 years and over decreased by 31,000 on the year, and 56,000 on the quarter, to 528,000

Looking in more detail at the increase of 9,000 in unemployment over the last year (Figure 19):

  • the estimated number of people unemployed for up to six months increased by 150,000 to 943,000, and was up by 97,000 on the quarter

  • for those unemployed for over six months and up to 12 months, the number fell by 26,000 to 168,000, with a decrease of 38,000 on the quarter

  • long-term unemployment (those unemployed for over one year) was down by 115,000 to a record low of 227,000, with a 68,000 decrease on the quarter

These moves are consistent with the analysis that some of those who have been unemployed for longer periods may have currently stopped looking for work, therefore suppressing the increase in unemployment.

Hazard rates describe the gross flow from the second quarter as a percentage of the total stock in the first quarter. Figure 20 shows that nearly a third of those who were unemployed in January to March 2020 became economically inactive in April to June 2020. This provides further evidence that those who were unemployed have become economically inactive as they have stopped looking for work in the current conditions.

The relative flatness of the unemployment figures may seem surprising. However, to be unemployed someone has to say that they do not have a job and that they are currently actively seeking and available for work.

Last month we reported on a group of employees who, because of the impact of the coronavirus (COVID-19), have reported that they are temporarily away from work and not getting paid. Similarly there are a group of self-employed people who are temporarily away from work but not eligible for the Self-Employment Income Support Scheme (SEISS). This month we have published an article giving further information on people who are temporarily away from paid work. Although these people consider themselves to have a job and therefore are consistent with the International Labour Organization (ILO) definition of employment, the lack of income means that they may soon need to look for work unless they are able to return to their job.

It is also possible to identify certain groups who are economically inactive as they are not currently looking for work, but may look for work in the future. These are primarily those who want a job but are not yet looking, but also includes those who report they do not want a job but either do not believe jobs are available, are not yet looking, or are inactive for some other unspecified reason. The number of people in these categories has increased by 383,000 on the quarter.

Between January to March 2020 and April to June 2020, the number in these groups – the inactive who may begin to seek work and temporarily away from work for coronavirus reasons, without earnings – increased by 1.03 million to 2.13 million (Figure 21). This increase of people who are around the fringes of unemployment may explain why unemployment under the ILO definition has not increased.

The Claimant Count (Experimental Statistics)

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These Claimant Count statistics relate to 11 June 2020. Enhancements to Universal Credit as part of the UK government's response to the coronavirus mean that an increasing number of people became eligible for unemployment-related benefit support, although still employed.

Consequently changes in the Claimant Count will not be due wholly to changes in the number of people who are unemployed. We are not able to identify to what extent people who are employed or unemployed have affected the numbers.

The Claimant Count is an Experimental Statistic that seeks to measure the number of people claiming benefit principally for the reason of being unemployed.

To achieve this, the Claimant Count has generally been a count of the appropriate benefits within the UK's current benefit regime that best meet that criteria. Currently this is a combination of claimants of Jobseeker's Allowance (JSA) and claimants of Universal Credit (UC) who fall within the UC "searching for work" conditionality.

Those claiming unemployment-related benefits (either UC or JSA) may be wholly unemployed and seeking work, or may be employed but with low income and/or low hours, that make them eligible for unemployment-related benefit support.

Under UC a broader span of claimants became eligible for unemployment-related benefit than under the previous benefit regime. During the roll-out of UC since 2013, movements in the Claimant Count have been significantly affected by this expanding eligibility, rather than labour market conditions. This impact has led to the Claimant Count being reclassified to an Experimental Statistic.

As part of the UK government's response to the coronavirus (COVID-19) pandemic, a number of enhancements were introduced to UC. These may have increased the number of employed people eligible for UC through their earnings falling below income thresholds.

Such claims will generally fall within the work search conditionality within UC.

Consequently, while some of any movement in the Claimant Count would be because of changes in the number of people who are out of work, a certain amount of the movement will be because of changes in the number of people in work who are eligible for UC as part of the government response. We are not able to identify to what extent these two factors have affected the numbers.

The Claimant Count increased in July 2020 to 2.7 million (Figure 22). This represents a monthly increase of 3.6% but an increase of 116.8%, or 1.4 million, since March 2020.

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6. Economic inactivity

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 between 16 and 64 years.

Since comparable records began in 1971, the economic inactivity rate for all people aged between 16 and 64 years has generally been falling (although it increased during recessions). This is because of a gradual fall in the economic inactivity rate for women (as seen in Figure 23). Over recent years, the economic inactivity rate for men has been relatively flat.

For people aged between 16 and 64 years, for April to June 2020:

  • the estimated economic inactivity rate for all people was 20.4%; this is down by 0.4 percentage points on the year but up by 0.2 percentage points on the quarter

  • the estimated economic inactivity rate for men was 16.4%; this is largely unchanged on the year and up by 0.3 percentage points on the quarter

  • the estimated economic inactivity rate for women was 24.3%; this is down by 0.7 percentage points on the year but up by 0.1 percentage points on the quarter

Experimental estimates based on returns for individual weeks suggest that the economic inactivity rate remained steady through June. Further details of the experimental weekly figures can be found in the Single month article.

Imputation used for the Labour Force Survey was not designed to deal with the changes experienced in the labour market in recent months. Experimental work with adjusted imputation methodology suggests the use of the existing methodology has little impact on the economic inactivity rate (less than 0.1 percentage points). Further information can be found in the section on Measuring the data.

Estimates for April to June 2020 show 8.44 million people aged between 16 and 64 years not in the labour force (economically inactive). This was 608,000 fewer than five years earlier and 127,000 fewer than a year earlier. The annual decrease was driven by women (down 146,000 to 5.06 million) and people aged 18 to 34 years (down 140,000) (Figure 24).

The estimated fall of 608,000 in economic inactivity over the last five years was largely among women, with a decrease of 556,000. This reflects changes to the State Pension age, resulting in fewer women retiring between the ages of 60 and 65 years, as well as more women in younger age groups participating in the labour market.

Economic inactivity has increased on the quarter by 82,000. This was driven by men (up 62,000), while the level for women increased for the first time since August to October 2019 (up 21,000).

Looking at the movements in economic inactivity over the last year by reason (Figure 25), we see that the largest decrease was for people looking after the family or home (down by a record 299,000, or 14.9%, on the year to a record low of 1.71 million), followed by economically inactive students (down by a record 128,000, or 5.7%, on the year).

Long-term sick also decreased by 60,000 on the year, the largest decrease since April to June 2017, and a record 126,000 on the quarter to 1.97 million. However, it was partially offset by an increase in the number of people who were economically inactive for other reasons (up by a record 298,000, or 30.3%, on the year and 314,000 on the quarter to a record high of 1.28 million). Discouraged workers also increased by 23,000 (63.2%) on the year and a record 21,000 on the quarter to 58,000, the highest level since April to June 2013.

Other reasons include people who:

  • are waiting the results of a job application

  • have not yet started looking for work

  • do not need or want employment

  • have given an uncategorised reason for being economically inactive

  • have not given a reason for being economically inactive

Those who are economically inactive and who want a job increased by 235,000 on the year and 218,000 on the quarter, while those who do not want a job decreased by 362,000 on the year and 135,000 on the quarter (Figure 26). This suggests that people who want employment are not currently looking for work, and is a further explanation of why we are not seeing a large rise in unemployment. (Further information can be found in Section 11: Measuring the data.)

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7. Flows

Looking at estimates of flows between employment, unemployment and economic inactivity between January to March 2020 and April to June 2020 (Figure 27), there was a net flow of:

  • 52,000 from employment to inactivity, the largest since October to December 2016

  • 23,000 from unemployment to inactivity, the first net flow from unemployment into inactivity on record

  • 21,000 from employment to unemployment, the first net flow from employment into unemployment since April to June 2009

The net flow into inactivity was 75,000, the first net increase into inactivity since January to March 2013, driven by those moving from unemployment to inactivity.

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8. Redundancies

Redundancies increased by 30,000 on the year and 27,000 on the quarter to 134,000. While this is the highest level since February to April 2013, the level remains well below that seen during the 2008 downturn.

The redundancies 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.

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9. Employment in the UK data

Employment, unemployment and economic inactivity
Dataset A05 SA | Released 11 August 2020
Estimates of UK employment, unemployment and economic inactivity broken down into age bands.

Full-time, part-time and temporary workers
Dataset EMP01 SA | Released 11 August 2020
Estimates of UK employment including a breakdown by sex, type of employment, and full-time and part-time working.

Actual weekly hours worked
Dataset HOUR01 SA | Released 11 August 2020
Estimates for the hours that people in employment work in the UK.

Unemployment by age and duration
Dataset UNEM01 SA | Released 11 August 2020
Estimates of unemployment in the UK including a breakdown by sex, age group and the length of time people are unemployed.

Economic inactivity by reason
Dataset INAC01 SA | Released 11 August 2020
Estimates of those not in the UK labour force measured by the reasons given for economic inactivity.

Labour Force Survey sampling variability
Dataset A11 | Released 11 August 2020
Labour Force Survey (LFS) sampling variability (95% confidence intervals).

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10. Glossary

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.

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 not been seeking work within the last four weeks and/or are unable to start work in the next two weeks. The economic inactivity rate is the proportion of people aged between 16 and 64 years who are not in the labour force.

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. A more detailed explanation is available in our guide to labour market statistics.

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 who are unemployed. It is the proportion of the economically active population (that is, those in work plus those seeking and available to work) who are unemployed.

A more detailed glossary is available.

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11. Measuring the data

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 the LFS QMI.

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

Coronavirus

In response to the developing coronavirus (COVID-19) pandemic, we are working to ensure that we continue to publish economic statistics. For more information, please see COVID-19 and the production of statistics.

We have reviewed all publications and data published as part of the labour market release in response to the coronavirus pandemic. This has led to the postponement of some publications and datasets to ensure that we can continue to publish our main labour market data. This will protect the delivery and quality of our remaining outputs as well as ensuring we can respond to new demands as a direct result of the coronavirus.

For more information on how labour market data sources, among others, will be affected by the coronavirus pandemic, see the statement published on 27 March 2020. A further article published on 6 May 2020, detailed some of the challenges that we have faced in producing estimates at this time.

Our latest data and analysis on the impact of the coronavirus on the UK economy and population is now available on our dedicated coronavirus webpage. This will be the hub for all special coronavirus-related publications, drawing on all available data.

Impact of the coronavirus on data collection

The Labour Force Survey design is based on interviewing households over five consecutive quarters. Generally, the first of these interviews, called wave 1, takes place face-to-face, with most subsequent interviews, for waves 2 to 5, conducted by telephone.

During March, we stopped conducting face-to-face interviews, instead switching to using telephone interviewing exclusively for all waves. This initially caused a significant drop in response.

New measures have been introduced to improve this, which have increased sample sizes during April and May, although they are still below normal Labour Force Survey sample sizes.

Impact of the coronavirus on survey imputation methodology

The normal imputation for non-response to the Labour Force Survey relies on rolling forward previous responses. Although this method is adequate under normal circumstances, it is not designed to deal with the changes experienced in the labour market in recent months. A new experimental imputation methodology has been researched to improve the measurement of the labour market at this time.

Because of time and system constraints, it has not been possible to fully integrate this methodology into the results within this release, but early indications suggest that:

  • there is little impact from the use of existing methodology on the headline measures of employment, unemployment and economic inactivity (less than 0.1 percentage points)

  • measures relating to hours in this release understate the reduction in the actual number of hours worked by approximately 7% to 8%

We hope to include more information in later releases as this work develops.

Impact of the coronavirus on survey weighting methodology

Because of the impact on data collection, different weeks throughout the quarter have different achieved sample sizes. To mitigate this impact on estimates the weighting methodology was enhanced to include weekly calibration to ensure that samples from each week had roughly equal representation within the overall three-month estimate. This meant that any impacts seen from changes in the labour market in those weeks would be fully represented within the estimates.

Impact of government measures to protect businesses on the Labour Force Survey estimates

During late March, the government announced a number of measures to protect UK businesses. This included the Coronavirus Job Retention Scheme (CJRS), also referred to as furloughing, and the Self-Employment Income Support Scheme (SEISS).

The Office for National Statistics (ONS) classifies people within the labour market in line with International Labour Organization (ILO) definitions. Under the ILO definition employment includes employed persons "at work", that is, who worked in a job for at least one hour; and employed persons "not in work" because of temporary absence from a job, or to working time arrangements.

Under the current schemes it is likely that workers would have an expectation of returning to that job and would consider the absence from work as temporary. Therefore, those people absent from work under the current schemes would generally be classified as employed under ILO definitions.

In many cases, however, they would be employed but not in work. This absence would have an impact on the total hours worked. This would also be reflected in the average actual hours worked, which are based on the average hours per person employed, rather than the average hours per person at work. While actual hours would be significantly affected, there is unlikely to be any impact on usual hours, which would reflect normal working patterns.

After EU withdrawal

As the UK leaves the EU, it is important that our statistics continue to be of high quality and are internationally comparable. During the transition period, those UK statistics that align with EU practice and rules will continue to do so in the same way as before 31 January 2020.

After the transition period, we will continue to produce our labour market statistics in line with the UK Statistics Authority's Code of Practice for Statistics and in accordance with International Labour Organization (ILO) definitions and agreed international statistical guidance.

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12. Strengths and limitations

Uncertainty in this data

The estimates presented in this bulletin contain uncertainty. There are many sources of uncertainty, but the main sources in the information presented include each of the following.

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 such as time and cost constraints. 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.

As the number of people available in the sample gets smaller, the variability of the estimates that we can make from that sample size gets larger. Estimates for small groups (for example, unemployed people aged between 16 and 17 years), which are based on small subsets of the LFS sample, are less reliable and tend to be more volatile than for larger aggregated groups (for example, the total number of unemployed people).

In general, changes in the numbers (and especially the rates) reported in this bulletin between three-month periods 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.

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.

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

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Manylion cyswllt ar gyfer y Bwletin ystadegol

Bob Watson
labour.market@ons.gov.uk
Ffôn: +44 (0)1633 455070