Labour market data shows signs of downturn
16 May 2023
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In the Media
Economic Theory
Commenting on the Office for National Statistics’ latest labour market data, Professor Len Shackleton, Labour Market Expert at free market think tank the Institute of Economic Affairs, said:
“These labour market data could be the harbinger of a downturn – although we must always be careful in extrapolating from a single month’s figures.
“Unemployment is up marginally to 3.9 per cent, driven by more people in longer-term unemployment. Payrolled employees (i.e. excluding the self-employed, whose numbers appear to be rising again) have fallen by 136,000 in April, the first fall in over two years. Vacancies have fallen for the tenth consecutive month.
“There has been a slight drop in inactivity as more young people and over-65s are in employment, but there has also been a further rise in the long-term sick (possibly due in part to NHS treatment delays associated with industrial action). Days lost to strikes across the economy rose to well over half a million in March, a rate not seen since the 1980s.
“Pay has continued to rise significantly in nominal terms, with the private sector again outstripping the public sector, although both experienced real-terms pay cuts. There are also some worrying trends below the surface: public sector employment as a share of total employment continues to rise, while women’s employment slipped back compared to men’s. And any employment growth seems to be associated with non-UK nationals, whose numbers in work rose by over 370,000 since the end of last year. Meanwhile, far too many working-age Brits sit it out on the touchline.”
ENDS
Notes to Editors
CONTACT: media@iea.org.uk / 07763 365520
The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems. The IEA is a registered educational charity and independent of all political parties.
“These labour market data could be the harbinger of a downturn – although we must always be careful in extrapolating from a single month’s figures.
“Unemployment is up marginally to 3.9 per cent, driven by more people in longer-term unemployment. Payrolled employees (i.e. excluding the self-employed, whose numbers appear to be rising again) have fallen by 136,000 in April, the first fall in over two years. Vacancies have fallen for the tenth consecutive month.
“There has been a slight drop in inactivity as more young people and over-65s are in employment, but there has also been a further rise in the long-term sick (possibly due in part to NHS treatment delays associated with industrial action). Days lost to strikes across the economy rose to well over half a million in March, a rate not seen since the 1980s.
“Pay has continued to rise significantly in nominal terms, with the private sector again outstripping the public sector, although both experienced real-terms pay cuts. There are also some worrying trends below the surface: public sector employment as a share of total employment continues to rise, while women’s employment slipped back compared to men’s. And any employment growth seems to be associated with non-UK nationals, whose numbers in work rose by over 370,000 since the end of last year. Meanwhile, far too many working-age Brits sit it out on the touchline.”
ENDS
Notes to Editors
CONTACT: media@iea.org.uk / 07763 365520
The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems. The IEA is a registered educational charity and independent of all political parties.
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