ONS Labour Market Overview: September 2024
The UK labour market continues to show a mix of resilience and volatility, with fluctuations in employment, payrolled employees, vacancies, and pay growth. This article offers an in-depth overview of key employment trends for July and August 2024, based on the latest Office for National Statistics Report data.
The UK labour market experienced notable changes in mid-2024, marked by slight decreases in payrolled employees and vacancies, alongside steady wage growth. While long-term growth trends remain positive, short-term volatility and administrative changes are reshaping labour market dynamics. This article provides a detailed breakdown of recent employment statistics, focusing on payrolled employees, unemployment, vacancies, and wage growth, to help businesses and policymakers understand the current labour market landscape.
Key Payrolled Employee Trends
Between June and July 2024, the number of payrolled employees in the UK decreased by 6,000, a 0.0% change. However, compared to the same period in 2023, payrolled employees rose by 203,000, reflecting a 0.7% year-on-year increase. In contrast, early estimates for August 2024 show a more significant monthly decrease of 59,000 employees, although the year-on-year figure still indicates a rise of 122,000 (0.4%) to a total of 30.3 million employees. It’s important to note that August’s estimate is provisional and may be revised as additional data becomes available.
Employment and Unemployment Rates
The employment rate for individuals aged 16 to 64 in the UK was estimated at 74.8% for May to July 2024. Although this is lower than the previous year’s estimate, the rate improved slightly from the previous quarter. Similarly, the unemployment rate (for those aged 16 and over) stood at 4.1%, showing a decline both over the quarter and compared to last year. Meanwhile, the economic inactivity rate (16 to 64-year-olds) was recorded at 21.9%, an improvement from the prior quarter but higher than the previous year’s estimate.
Claimant Count and Policy Changes
The UK’s Claimant Count for August 2024 rose to 1.792 million, increasing both monthly and annually. This spike in claimants is partly attributed to a policy change implemented in May 2024, which increased the administrative earnings threshold for full work search conditionality. This change is expected to impact approximately 180,000 claimants over six months, further raising the Claimant Count during that period.
Vacancy Decline Continues
The period between June and August 2024 saw the UK’s estimated number of job vacancies fall by 42,000 compared to the previous quarter, leaving the total at 857,000. Although vacancies remain above pre-pandemic levels, this marks the 26th consecutive quarterly decline, signalling a potential cooling in demand for labour.
Workforce Jobs Overview
As of June 2024, the UK recorded 37.1 million workforce jobs, a year-on-year increase of 503,000 but a quarterly decline of 28,000. Notably, employee jobs rose by 386,000 over the year and by 62,000 on the quarter, reaching 32.7 million.
Wage Growth and Real Pay Adjustments
In the period from May to July 2024, annual growth in employees’ average regular earnings (excluding bonuses) in Great Britain was recorded at 5.1%. Total earnings (including bonuses) grew by 4.0%, with these figures affected by one-off payments to NHS and civil service workers in June and July 2023. In real terms, adjusted for inflation (CPIH), regular pay grew by 2.2%, and total pay increased by 1.1%, offering some relief amid rising living costs.
Labour Disputes and Strikes
Labour disputes continue to affect the UK workforce, with an estimated 42,000 working days lost due to strikes in July 2024. The majority of these disputes occurred in the health and social work sector, reflecting ongoing tensions over pay and working conditions in these critical areas.
The UK labour market in mid-2024 presents a complex picture of steady wage growth, rising claimant counts, and declining vacancies. While long-term employment growth remains positive, short-term fluctuations highlight the need for caution. Businesses and policymakers must keep a close eye on provisional data, labour market indicators, and the impacts of policy changes to navigate the evolving economic environment effectively.
Source: Labour market overview, UK – Office for National Statistics (ons.gov.uk)
