But unemployment sees slight increase
The employment rate in the UK reached 76.0% between February and April 2023, showing a slight increase of 0.2% compared to the previous period of November 2022 to January 2023. This record high reflects growth in both the number of employees and self-employed individuals.
According to the latest estimate, the number of payrolled employees in May 2023 rose by 23,000 compared to April 2023, reaching a total of 30.0 million. However, this estimate is provisional and may be revised as more data becomes available next month.
On the other hand, the unemployment rate for February to April 2023 rose by 0.1 percentage points to 3.8%. The increase in unemployment was primarily driven by individuals who had been unemployed for up to 12 months.
The economic inactivity rate, which measures the proportion of people not actively seeking employment, decreased by 0.4% to 21.0% during February to April 2023. The decrease in economic inactivity was largely due to individuals who were inactive for reasons other than unemployment or family responsibilities. However, there was a record-high increase in individuals who were inactive due to long-term sickness.
During March to May 2023, the number of job vacancies decreased by 79,000 compared to the previous quarter, reaching a total of 1,051,000 vacancies. This marks the 11th consecutive period of declining job vacancies and reflects industry uncertainty, with economic pressures cited as a factor hindering recruitment by survey respondents.
Average total pay, including bonuses, saw growth of 6.5% among employees in February to April 2023. Additionally, regular pay, excluding bonuses, experienced significant growth of 7.2%. This is the highest growth rate for regular pay seen outside the COVID-19 pandemic. However, when adjusted for inflation, both total and regular pay experienced a decline on a yearly basis, with a 2.0% decrease in total pay and a 1.3% decrease in regular pay.
Labour disputes resulted in 257,000 working days lost in April 2023 due to strikes or other labour-related conflicts.
In March 2023, the number of workforce jobs reached a new record high of 36.8 million, with a remarkable increase of 395,000 jobs compared to the previous quarter. This growth was observed across eight out of the 20 industry sectors, marking new record highs in those sectors.
The Institute for Employment Studies released comment: “It is likely that today’s figures will lead to more pressure to raise interest rates in order to dampen demand and bring down pay growth. While this is understandable, our view is that the top priority should instead be to do far more to boost supply, which would in turn support higher living standards and economic growth. This means in particular doing far more to support people who are out of work and who want to work – especially those with long-term health conditions, disabled people, young people and older workers – and working better with employers on inclusive recruitment, job design, workplace support and progression in work.”