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Number of people in work continues to rise, reveals ONS

The Office for National Statistics (ONS) has released its employment data for the period between May and July 2016, with the number of people in work once again increasing.

Between February to April 2016 and May to July 2016, the number of people in work increased. The number of unemployed people and the number of people not working and not seeking or available to work (economically inactive) fell.

There were 31.77m people in work between May and July 2016, 174,000 more than for February to April 2016 and 559,000 more than for a year earlier.

There were 23.25m people working full-time, 434,000 more than for a year earlier. There were 8.51m people working part-time, 126,000 more than for a year earlier.

The employment rate (the proportion of people aged from 16 to 64 who were in work) was 74.5%, the joint highest since comparable records began in 1971.

There were 1.63m unemployed people (people not in work but seeking and available to work), 39,000 fewer than for February to April 2016, 190,000 fewer than for a year earlier and the lowest since March to May 2008.

There were 901,000 unemployed men, 88,000 fewer than for a year earlier. There were 731,000 unemployed women, 102,000 fewer than for a year earlier.

The unemployment rate was 4.9%, down from 5.5% for a year earlier. The last time it was lower was for July to September 2005. The unemployment rate is the proportion of the labour force (those in work plus those unemployed) that were unemployed.

There were 8.83m people aged from 16 to 64 who were economically inactive (not working and not seeking or available to work), 92,000 fewer than for February to April 2016 and 195,000 fewer than for a year earlier.

The inactivity rate (the proportion of people aged from 16 to 64 who were economically inactive) was 21.5%, the lowest since comparable records began in 1971.

Average weekly earnings for employees in Great Britain in nominal terms (that is, not adjusted for price inflation) increased by 2.3% including bonuses and by 2.1% excluding bonuses compared with a year earlier.

John Salt, group sales director at totaljobs, commented, “This month’s ONS report includes over five weeks of labour market data following the Referendum, and it’s great to see that even during this unsettling period, unemployment has fallen yet again. Businesses are clearly eager to keep on hiring, and confidence in the jobs market remains high. We’ve seen this positivity reflected in our most recent Totaljobs Employment Index, which showed the number of jobs posted on the site in August jump a staggering 19% year-on-year.

“This is strong evidence that the UK jobs market is in good health. That said, if the economy is to remain on the same trajectory, the Government must continue to support businesses of all sizes, creating an environment where businesses can, and will, keep on hiring in the face of uncertainty into 2017.”

Work and Pensions Secretary of State, Damian Green, said, “It’s great to see another record-breaking set of figures out this month with the unemployment rate at a 10-year low and wages growing healthily.

“We know that there are fewer children living in workless households too, which underlines our efforts to help people move into employment and to build a Britain that works for everyone, not just the privileged few.

“But there’s more to do, and we will continue to work with businesses to help more people take up the wealth of opportunities out there in the economy.”

Doug Monro, co-founder of Adzuna, stated, “The shock of Brexit hasn’t shaken the jobs market too much – for now. Employment sits at a record high, although these figures only take into account one month after the vote.

“For many industries it’s not been entirely smooth sailing. Stronger repercussions are being felt in higher paying sectors that rely heavily on overseas staff. Caution is taking effect and fewer vacancies are on offer in areas like legal and finance. At the same time, employers are seeking more contract and temporary staff to plug gaps in their workforces without committing to expensive hires. Chancellor Philip Hammond’s recent comments signal that he will try to negotiate an exemption from immigration curbs for these sectors, which would help to restore some confidence. It could be just in time.

“Graduates are also facing a tougher labour market – starting salaries are 4.3% lower than a year ago and there are fewer entry level roles on offer. Meanwhile inflation looks likely to rise over the next few months which will eat into real wages. Employers need a confidence boost to invest more. The Autumn Statement could be a timely opportunity for the Chancellor to reassure employers and give the job market a lift.”

Recruitment & Employment Confederation chief executive, Kevin Green, said, “The labour market continues to perform well. Whilst today’s ONS data only covers one month since the referendum result, it does support the idea that employers avoided any knee-jerk reactions immediately after the vote.  

“It is encouraging to see that of the 559,000 jobs created in the last year, 434,000 are full-time positions. We are at near-full employment at 74.5 per cent. This is good news, however problems that hindered the jobs market before the referendum remain, with businesses in a range of sectors experiencing major skills shortages.

“Pay continues to grow at 2.3 per cent, but with inflation expected to rise over the coming months this weakening growth rate is an area of concern. 

“The economy has so far recovered well from the post-referendum shock, largely because of a business-as-usual attitude from consumers and employers, but confidence remains fragile. We hope to see fiscal stimulus from the Chancellor at the Autumn Statement to help bolster the jobs market, and we call for sensible decisions around any new immigration policy so that businesses can continue to access the people they need.”

Jason Downes, managing director of, stated, "Britain’s unemployment report shows little evidence that the Brexit vote has hurt the economy (yet, anyway). In the three months from May to July, the number of people out of work fell by 39,000, which kept the unemployment rate at 4.9%. But the number of people employed also jumped by an impressive 174,000 - taking the total to 31.77 million.

"This shows that businesses have become more competitive when it comes to recruitment to attract top talent. Interestingly, many organisations have recently come into fire for using zero-hour contracts, and as they start to crack down on this I think we will start to see a rise in full-time and contracted employment."

Nigel Meager, director of the Institute for Employment Studies, commented, "The latest employment statistics from ONS cover the three-month period up to the end of July, so include some data from the early weeks following the EU referendum in late June.

"There is, however, as yet no evidence in these data of the labour market reacting in anticipation of Brexit. The figures remain very strong, with the employment rate again at its highest since records began (nearly 75%), and unemployment the lowest for over ten years (4.9%). Both self-employed and employee jobs continue to increase.

"The employer nervousness about Brexit anticipated by some commentators has yet to show up in any real fall in hiring activity: the level of unfilled vacancies has remained flat at around three quarters of a million for most of 2016 (following continuous growth in the period since 2010).

"However, these are still very early days, and one possible indicator of a shift which will come through in subsequent months, can be seen in the single month employment estimates for July issued by ONS at the same time. These should be treated with caution as a single month’s data are not ‘official statistics’, being based on a smaller sample size. However, it is notable that unlike the three months’ data for May-July, the July estimates taken alone show a fall in employment of 105,000 over the month, which would be consistent with the first signs of a Brexit effect coming through. If so, the next few sets of official employment data from ONS could be more interesting."

Neil Carberry, CBI director of People and Skills, said, “With much of the data still pre-Referendum, it’s too early to make any assumptions about the effect of June’s vote to leave the European Union on the UK’s labour market.

“But the strength of employment growth in the first half of this year is encouraging, and highlights the resilience of the UK’s flexible labour market.

“Maintaining this flexibility as we navigate the challenges and opportunities the country faces following the EU Referendum will be vital for our future prosperity, pay and job creation.” 

Picture courtesy of Pixabay

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