Labour market overview, UK: April 2019

Commentary on topics covered in the previous Labour market statistics bulletin is now split into four separate bulletins. This is part of our ongoing work to improve bulletins. Other commentary from the latest labour market data can be found on the following pages:

• Employment in the UK

• Average weekly earnings in Great Britain

• Vacancies and jobs

• The UK employment rate was estimated at 76.1%, higher than for a year earlier (75.4%) and the joint-highest figure on record.

• The UK unemployment rate was estimated at 3.9%; it has not been lower since November 1974 to January 1975.

• The UK economic inactivity rate was estimated at 20.7%, lower than for a year earlier (21.2%) and the joint-lowest figure on record.

• Excluding bonuses, average weekly earnings for employees in Great Britain were estimated to have increased by 3.4%, before adjusting for inflation, and by 1.5%, after adjusting for inflation, compared with a year earlier.

• Including bonuses, average weekly earnings for employees in Great Britain were estimated to have increased by 3.5%, before adjusting for inflation, and by 1.6%, after adjusting for inflation, compared with a year earlier.

Employment

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

Estimated employment rates for men and women aged between 16 and 64 years have been generally increasing since early 2012. For December 2018 to February 2019, the employment rate:

• for all people was estimated at 76.1%, the joint-highest since comparable records began in 1971

• for men was estimated at 80.5%; it has not been higher since December 1990 to February 1991

• for women was estimated at 71.8%, the joint-highest since comparable records began in 1971

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

Estimates for December 2018 to February 2019 show 32.72 million people aged 16 years and over in employment, 457,000 more than for a year earlier. This annual increase of 457,000 was due entirely to more people working full-time (up 473,000 on the year to reach 24.15 million). Part-time working showed a small fall of 15,000 on the year to reach 8.57 million.

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

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 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 December 2018 to February 2019, the unemployment rate:

• for everyone was estimated at 3.9%; it has not been lower since November 1974 to January 1975

• for men was estimated at 4.1%

• for women was estimated at 3.8%, the joint-lowest since comparable records began in 1971

For December 2018 to February 2019, an estimated 1.34 million people were unemployed, 76,000 fewer than for a year earlier and 914,000 fewer than for five years earlier.

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

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 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 due to a gradual fall in the economic inactivity rate for women.

For people aged from 16 to 64 years for December 2018 to February 2019, the economic inactivity rate:

• for all people was estimated at 20.7%, the joint-lowest figure since comparable records began in 1971

• for men was estimated at 16.0%; it has not been lower since May to July 2003

• for women was estimated at 25.3%, the joint-lowest figure since comparable records began in 1971

Estimates for December 2018 to February 2019 showed 8.54 million people aged from 16 to 64 years not in the labour force (economically inactive). This was:

• 213,000 fewer than for a year earlier

• 456,000 fewer than for five years earlier

• the lowest since January to March 1993

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

Earnings growth

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.

Earnings in real terms (that is, adjusted for inflation) is calculated as nominal earnings (that is, not adjusted for inflation), deflated by the Consumer Prices Index including owner occupiers’ housing costs (CPIH).

Between December 2017 to February 2018 and December 2018 to February 2019 for employees in Great Britain:

• regular pay was estimated to have increased by 3.4% in nominal terms and by 1.5% in real terms

• total pay was estimated to have increased by 3.5% in nominal terms and by 1.6% in real terms

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

Vacancies

The estimated number of vacancies in the UK fell sharply during the recession of 2008 to 2009 but has increased steadily since 2012. For January to March 2019 there were an estimated 852,000 vacancies in the UK, 32,000 more than a year earlier.

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

Summary of labour market statistics
Dataset A01 | Released 16 April 2019
Estimates of employment, unemployment and other employment-related statistics for the UK.

Employment, unemployment and economic inactivity
Dataset A02 SA | Released 16 April 2019
Estimates of UK employment, unemployment and inactivity for people aged 16 years and over and people aged from 16 to 64 years based on the Labour Force Survey.

Average weekly earnings
Dataset EARN01 | Released 16 April 2019
Estimates of Great Britain earnings growth based on the Monthly Wages and Salaries Survey.

Vacancies by industry
Dataset VACS02 | Released 16 April 2019
Estimates of the number of UK job vacancies for each industry based on a survey of businesses.

Average weekly earnings

Average weekly earnings measures money paid by employers to employees in Great Britain before tax and other deductions from pay. The estimates are not just a measure of pay rises as they also reflect, for example, changes in the overall structure of the workforce. More high-paid jobs in the economy would have an upward effect on the earnings growth rate.

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 they are unable to start work in the next two weeks. The economic inactivity rate is the proportion of people aged from 16 to 64 years who are not in the labour force.

Employment

Employment measures the number of people in paid work and differs from the number of jobs because some people have more than one job. The employment rate is the proportion of people aged from 16 to 64 years who are in paid work.

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.

Vacancies

Vacancies are defined as positions for which employers are actively seeking recruits from outside their business or organisation. The estimates are based on the Vacancy Survey – a survey of businesses designed to provide estimates of the stock of vacancies across the economy, excluding agriculture, forestry and fishing (a small sector for which the collection of estimates would not be practical).

A more detailed Glossary is available.

The employment, unemployment and economic inactivity estimates rely on data collected from the Labour Force Survey (a survey run by field interviewers with people across the UK every month).

The Labour Force Survey performance and quality monitoring reports provide data on response rates and other quality-related issues for the Labour Force Survey (LFS), including breakdowns of response by LFS wave, region and by question-specific response issues.

The average weekly earnings and vacancies estimates rely on data collected from surveys of employers.

The following Quality and Methodology Information (QMI) reports pull together important qualitative information on the various dimensions of data quality, as well as providing a summary of the methods used to compile the output:

• Labour Force Survey Quality and Methodology Information

• Average weekly earnings (AWE) Quality and Methodology Information

• Vacancy Survey Quality and Methodology Information

Accuracy of the statistics: estimating and reporting uncertainty

The figures in this bulletin come from surveys, which gather information from a sample 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 from 16 to 17 years), which are based on quite small subsets of the Labour Force Survey 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.

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

Where to find data about uncertainty and reliability

Dataset A11 shows sampling variabilities for estimates derived from the Labour Force Survey.

Sampling variability information for average weekly earnings growth rates is available from the “Sampling Variability” worksheets within datasets EARN01 and EARN03.

The sampling variability of the three-month average vacancies level is around plus or minus 1.5% of that level.

Information on revisions is available in the labour market statistics revisions policy.