You could be forgiven for thinking that if the number of people who are employed declines then the number of unemployed people must have risen (unless they all retired, or died, of course). However, the UK has managed the feat of achieving lower numbers of people in and out of work without (as far as I can tell) a sudden rise in morbidity and retirement.
According to the UK’s Office for National Statistics (ONS), over the period from July to September the number of Britons in work declined by 14000 to approximately 32 million. This represents an increase in employment of 279000 in the year to September, however. The current employment rate has dipped from 75.1 to 75%. ONS indicated that unemployment (people without work and claiming job seeker’s allowance) declined by 59000 in the three months to September, meaning that unemployment stands at 1.425 million people with the unemployment rate unchanged at 4.3% of the working age population (not in training or education).
ONS’s explanation for the apparently contradictory declines in both employment and unemployment is that there has been a rise in the number of “economically inactive” people (i.e. those not in work and not actively seeking a job (or claiming job seeker’s allowance).
The slight fall in the ranks of the employed is the first decline seen in the figure since the reporting period ended in October 2016. The number of job vacancies has also fallen by 29000 and there has been an upturn in the number of part-time workers seeking full-time positions.
Of concern is the fact that wage increases have continued to lag behind inflation for a seventh consecutive month. Wages rose by 2.2% in the three months to September 2017 over the comparable period in 2016. When inflation is taken into consideration, the average wage has dipped by 0.5% during this period.
It is too early to say if this slight downturn is related to growing business concerns over Brexit, but it is fair to say that it does not show that employers are tripping over themselves in confidence to engage new workers to meet the rising demands that Brexit will bring…