The ONS have released the latest labour market information covering the quarter from April – June. With additional data available for the month of July.
Whilst on the surface the unemployment rate remains steady the numbers of those in employment and a rise in economic inactivity show that trouble is brewing, particularly for young people. The Job Retention Scheme is shielding some workers from these figures, we know that businesses are struggling with many left with no choice but to make redundancies, this coupled with a cohort of young people leaving education under some of the toughest/strangest circumstances will see unemployment and youth unemployment steadily grow.
The number of people in work has fallen by 220,000 those classed as economically active has risen by 82,000 with the claimant count rising by 94,000 in the last few months.
- There are currently 32.92 million people over the age of 16 in employment, this is 220,000 fewer than the last quarter, but 113,000 more than a year earlier.
- There are currently 1.34 million unemployed people, 9,000 fewer than the last quarter and 10,000 fewer than the previous year.
- Economic inactivity has risen to 8.44 million, this is 82,000 more than the previous quarter but 127,000 fewer than the previous year.
- The claimant count sits at 2.7 million, rising by 94,000 between June and July. Since the beginning of Lockdown there has been 1.4 million new claimants, an increase of 116.8%.
- There are now approximately 370,000 vacancies, 274,000 less than the previous quarter, and 453,000 fewer than a year earlier. Accommodation, food services activities sector is showing the strongest recovery thus far.
On top of these headlines we see that for those in work regular pay levels are down by 02.%, we see that there are now over a million people now on zero hour contracts and that the number of employees on payroll has fallen by 730,000.
What does this mean for youth unemployment
- There are currently 3.78 million 16-24 year olds in employment, a huge decrease of 100,000 from the last quarter and 87,000 fewer than a year earlier.
- There are 543,000 unemployed 16-24 year olds, 27,000 more than the last quarter and 41,000 more than the previous year.
- Economic inactivity has increased with 2.56 million 16-24 year olds not in employment or looking for employment. This is 61,000 more than the last quarter and unchanged from the previous year.
- The claimant count for 18-24 year olds stands at 531,300, up 14,100 on the previous month and up 297,100 since the start of lockdown in March.
There are now over 1 million young people not in employment, education or training (NEET), the highest since 2015. Currently 1 in 7 18 to 24 year olds are included in the claimant count.
We are concerned for the storm that is brewing for young people, the labour market is suffering, and there is more still to come as the JRS winds down.
We have always known that unemployment and youth unemployment rates and measures tell just part of the story, there are a lot of nuances to the data sets. We must recognise that young people are one of the most likely groups to be losing their jobs, that they are the group who find it harder to find work and the scarring effects of unemployment are felt most significantly by them. We can’t wait until the unemployment rate rises to act, we must ensure that we are working together to put the support in place now. That is why today we are sending our joint Youth Employment Group Recommendations to Ministers, MP’s and colleagues across government.
“We are really concerned for young people all around the UK at the moment. With so many nervous about the upcoming results days, this tough labour market stacks the odds against young people.
We are working hard in partnership with Government departments such as Department for Work and Pensions, Department of Education, and Department for Culture, Media and Sports to really try and shield young people from the economic impact of the Coronavirus. This generation of young people faces challenges and impacts to their employment prospects through no fault of their own. Further stimulus from the Treasury will be required to create jobs and more leadership from number 10 is required to commit to protecting young people and their future in this country, particularly those who are disadvantaged.” Laura-Jane Rawlings, CEO, Youth Employment UK