Labour market indicators

The Office for National Statistics continues to be cautious about its traditional measure of employment, blaming increased volatility of Labour Force Survey (LFS) estimates due to smaller samples.

It headlined its latest labour market statistics with Pay As You Earn real time information from HMRC.

The number of payrolled employees in February 2024 increased by 20,000 (0.1%) on the month and 368,000 (1.2%) on the year to 30.4 million (provisional). By the LFS measure, UK employment in November 2023 to January 2024 (for those aged 16 years and over) fell below estimates for a year earlier at 75%, down in the latest quarter.

The corresponding unemployment rate was 3.9% with an economic inactivity rate of 21.8%. The inactivity rate has been attracting attention for some time. It prompted calls by the National Centre for Universities and Business for a “comprehensive government strategy to address workforce preparation and training”.

While average weekly earnings growth slowed again slightly over the year to January, the slowdown in consumer price inflation was more marked (see column left).

A clear one percentage point gap has opened up between regular earnings growth of 5.9% (5.5% including bonuses) and RPI inflation (4.9% in January).