Labour Market Overview, UK: May 2023
The Office For National Statistics reported last month that during the period of January to March 2023, the estimated employment rate in the UK stood at 75.9%, showing a slight increase of 0.2 percentage points compared to October to December 2022. This rise in employment was primarily driven by part-time employees and self-employed individuals.
However, the more recent estimate for April 2023 indicates a monthly decrease in pay rolled employees, with a decline of 136,000 compared to the revised figures of March 2023, resulting in a total of 29.8 million pay rolled employees. This marks the first decrease in total pay rolled employees since February 2021. It's important to note that this figure is provisional and likely to be revised with the receipt of more data next month.
The unemployment rate for January to March 2023 increased by 0.1 percentage points from the previous quarter, reaching 3.9%. This increase in unemployment was predominantly due to individuals who had been unemployed for over 12 months.
According to flow estimates, between October to December 2022 and January to March 2023, there was a record high net flow of individuals moving from economic inactivity to employment.
From February to April 2023, the estimated number of job vacancies declined by 55,000 compared to the previous quarter, totalling 1,083,000 vacancies. This marks the 10th consecutive quarterly decrease in vacancies, reflecting industry uncertainty as economic pressures continue to impede recruitment, as reported by survey respondents.
Regarding average total pay (including bonuses), there was a growth rate of 5.8% in January to March 2023. The growth rate for regular pay (excluding bonuses) was 6.7% among employees during the same period. For the private sector, average regular pay experienced a growth rate of 7.0%, while the public sector saw a growth rate of 5.6% in January to March 2023. The public sector's higher growth rate was last observed in August to October 2003 (5.7%).
However, when considering inflation, the growth in real terms for both total pay and regular pay decreased compared to the previous year. In January to March 2023, there was a 3.0% decrease in real terms for total pay and a 2.0% decrease for regular pay.
In March 2023, the number of working days lost due to labour disputes reached 556,000, a significant increase from the 332,000 recorded in February 2023.
In the current economic climate, numerous large businesses are actively exploring avenues to minimize their payroll running costs. Outsourcing has emerged as a cost-effective solution, allowing companies to delegate financial services to specialized third-party providers. If you are interested in exploring how Mascolo & Styles can assist you in reducing costs, we invite you to contact us at 01420 544 444. Our team is ready to discuss your specific requirements and offer tailored solutions to meet your needs.
Source: ONS
