December labour market statistics report

The latest labour market figures published on 14 December are the third consecutive monthly set of disappointing figures. It is clear that the UK labour market is now slowing.

Learning & Work's monthly labour market statistics briefing has now been published.

Key points:

  • Unemployment is 1,616,000, up 12,000 from last month’s published figure (quarterly headline down and the unemployment rate is 4.8%, no change on last month and down 0.1 percentage points on last quarter.
  • The number of claimant unemployed is 809,000, up 2,400 on last month, and the claimant rate is 2.3%.
  • The number of workless young people (not in employment, full-time education or training) is 1,039,000, up 10,000 on the quarter, representing 14.5% of the youth population (up 0.2 percentage points).
  • Youth unemployment (including students) is 587,000, down 34,000 on the quarter.
  • There are 2.1 unemployed people per vacancy. Learning and Work Institute estimates this figure may rise next month.
  • The employment rate is 74.4% (down 0.1 percentage points on last month’s published figure and down 0.1 percentage points in the preferred quarterly measure).

Duncan Melville, Chief Economist at Learning and Work Institute, commented:

"Today's figures do show a fall in unemployment in the three months to August to October 2016, but unemployment was up in the latest month. The claimant count measure of unemployment has been rising since February and has risen by over 70,000 since then. Employment fell in both the quarter and the latest month. The level of vacancies has been flat at around 750,000 since the spring of this year. Hence unemployment did not fall in the quarter as a result of improved employment opportunities.

Rather increasing numbers of people are withdrawing from the labour market into economic inactivity. The number of people of working age (16-64 years) who are economically inactive has risen by around 100,000 in the last two months. It is concerning that unemployment is falling not because of an improving labour market but because people are withdrawing from the labour market. With continuing uncertainty over how the UK will exit the EU, it is unlikely that we will see a pick up in hiring by employers any time soon. As we approach the end of the year, the unfortunate prospect for 2017 looks likely to be one of rising worklessness and at best modest employment growth."