The latest Labour Force Survey (LFS) estimates for March to May 2022 show that over the quarter, there was an increase in the employment rate, while unemployment and economic inactivity rates decreased.
The UK employment rate increased by 0.4 percentage points on the quarter to 75.9%, but is still below pre- coronavirus (COVID-19) pandemic levels. The number of full-time employees increased during the latest three-month period to a record high. Part-time employees also increased during the latest three-month period, continuing to show a recovery from the large falls in the early stages of the coronavirus pandemic. The number of self-employed workers fell during the coronavirus pandemic and has remained low, although the number has increased during the latest three-month period. The increase was driven by part-time self-employed, and was largely offset by a decrease in the number of full-time self-employed.
The most timely estimate of payrolled employees for June 2022 shows a monthly increase, up 31,000 on the revised May 2022 figures, to a record 29.6 million.
The unemployment rate for March to May 2022 decreased by 0.1 percentage points on the quarter to 3.8%. Those unemployed for up to six months increased over the latest three-month period at the fastest rate since late 2020.
The economic inactivity rate decreased by 0.4 percentage points to 21.1% in March to May 2022. Since the start of the coronavirus pandemic, the increases in economic inactivity were driven by those who were economically inactive and who did not want a job. This group have now also driven the quarterly decrease during the latest period.
Louise Skittrall, founder of Swindon-based Robinson Grace HR Consultancy: “With the cost of living at the forefront of everyone’s minds, pay and perks are key. Employers offering incentives such as working from home, free parking, electric charging points or subsidised staff meals, will appear considerably more attractive to prospective employees seeking a more cost-effective job choice. Job vacancies continue to outweigh the number of applicants at the moment, which means that organisations are struggling to attract top talent. Employers are having to look at pay as a means of attracting applicants, but the importance of building a strong employee proposition has never been more important. Employees expect flexibility, hybrid working and above average benefits as there remains a reluctance to return to the office full time, and employers are pitted against each other to win the race to recruit. With remote working commonplace now, job candidates are able to spread their search wider than ever before in applying for jobs anywhere in the world. Employers are no longer able to simply match their nearest competitor and remain the top choice.”
David McCreadie. MD of Birmingham-based IT recruitment consultancy, Swi-tch: “The balance of power is very much with employees at the moment. The market has shifted 180 degrees since the start of the pandemic and businesses are struggling to attract top talent. Many companies are having to bend over backwards to secure talent, from offering 15%-20% increases on pre-pandemic salaries amid the cost of living crisis to fully remote opportunities. Businesses are really feeling the pressure of needing to invest in their staff. Employees are demanding flexibility and there is a reluctance to move back to the office on a full-time, or even hybrid, basis. The issues businesses face is that with employees holding all the cards, if employers do not offer flexibility and pay increases, their competitors will. You are no longer competing with local businesses now that travel and location are no longer a major factor. The entire country has opened up to employees so employers need to do everything they can to retain and attract them.”
Chris Maslin, director at Tunbridge Wells-based employee ownership specialists, Go Eo: “The pandemic enabled many people to work remotely, something many employers hadn’t allowed before. They got to choose how and where they worked. Many employees loved this extra control and the freedom it provided. It gave some people the encouragement to take even more control of their working lives, giving up their jobs completely, hence the Great Resignation. It is becoming harder for traditional employers to lure them back. People want the ability to influence their own lives, not have it dictated to them by their employers. However, not everyone wants to run their own business. A stable income is still high up most people’s wish list and employee ownership can provide the perfect balance. You’re not responsible for everything, you have teammates to help and you get a regular wage. Equally, you also have power to influence how the company runs. If it performs well, you reap the benefits. Empoyee ownership breaks down the barriers between owners and workers. It’s the future of healthy capitalism.”