Labour Market Report – July 23

The ONS (Office For National Statistics) reported this month that, as of March to May 2023, the UK employment rate stands at an estimated 76.0%, which is 0.2 percentage points higher compared to December 2022 to February 2023. The increase in employment during this period is primarily attributed to part-time employees.

However, the estimate of payrolled employees for June 2023 indicates a monthly decrease, down by 9,000 from the revised figure for May 2023, bringing the total to 30.0 million. It's important to note that the June 2023 estimate should be considered provisional and is likely to be revised when more data becomes available next month.

The unemployment rate for March to May 2023 has increased by 0.2 percentage points from the previous quarter, reaching 4.0%. The rise in unemployment is driven by individuals who have been unemployed for up to 12 months.

On a positive note, the economic inactivity rate has decreased by 0.4 percentage points on the quarter, reaching 20.8% in March to May 2023. The decline in economic inactivity during this period is largely due to individuals who were inactive for other reasons, those looking after family or home, and retirees.

The increases in employment and unemployment rates, as well as the decrease in the inactivity rate, during the latest quarter, were reported to be mainly attributed to men.

Between April and June 2023, the estimated number of job vacancies has fallen by 85,000 compared to the previous quarter, bringing the total to 1,034,000. This marks the 12th consecutive period of declining vacancies.

Regarding pay growth, employees' average total pay (including bonuses) has seen a growth rate of 6.9%, while regular pay (excluding bonuses) has experienced a growth rate of 7.3% in March to May 2023. The 7.3% growth in regular pay equals the highest rate recorded last month and during the COVID-19 pandemic period in April to June 2021.

However, in real terms, adjusted for inflation, both total pay and regular pay have seen a decline on a year-to-year basis in March to May 2023. Total pay has fallen by 1.2%, and regular pay has decreased by 0.8%.

Lastly, there were 128,000 working days lost due to labour disputes in May 2023, representing the lowest number of days lost since July 2022.

Source: ONS