The latest ONS labour market data (published at the start of this week) shows unemployment falling to 4.2 per cent. Redundancies remained below pre-pandemic levels, with just 1.2 unemployed per vacancy. In other words the effects on joblessness of ending of the furlough appear limited. Having said this,the ONS says it is still possible that people made redundant were working out their notice.
But if payroll employment has also continued to grow, the Institute for Employment Studies estimates that there’s now one million fewer people in the jobs market than there would have been on pre-crisis trends, with an increase approaching 400,000 in those ‘economically inactive’ (in other words not looking for work). This, it says, is due to many older workers not re entering the labour market after furlough. At the same time, the number of people out of work due to ill health has increased significantly. Now at 2.5 million, the highest figure since 2005.
The figures for those in 18-24 age group also make interesting reading. While the proportion of 18-24 year choosing full time education continues to creep up, there has been an increase in student working ( part-time working, which during the pandemic, is rising again) – student unemployment has fallen from 17% to 12% over the last year. But for those not in full-time education, if unemployment has fallen slightly (even if it still 10%) the number of those ‘economically inactive’ is now at 15.6% – approaching 1 in 6. This worrying trend should be reflected in the next NEET figures.