Coronavirus: labour market March update
Published 23/03/2021   |   Last Updated 23/03/2021   |   Reading Time minutes
Have official statistics started to reflect the impact of coronavirus on the labour market?
Each month the Office for National Statistics (ONS) publishes estimates of employment and unemployment rates. These estimates are based on information collected by the Labour Force Survey (LFS) for the preceding three-month period. The time lag to these figures means that the latest labour market release published on 23 March 2021 provides information from November 2020 to January 2021. The March LFS figures do not reflect the number of people who have been placed on furlough due to coronavirus.
The latest HMRC statistics on the Coronavirus Job Retention Scheme (CJRS) show 178,000 employments in Wales have been furloughed as at 31 January 2021. This represents a take up rate of 14%. 92,500 females and 85,400 males were furloughed under the CJRS in Wales as at 31 January 2021. Data at a constituency level shows the take up rate of furloughed employments is highest in Dwyfor Meirionnydd (22%) and lowest in Islwyn (10%).
What do the latest Labour Force Survey figures show?
The Labour Force Survey (LFS) is a quarterly household survey of around 80,000 adults. The survey asks a range of questions on employment and the labour market. As people are still furloughed this doesn’t reflect the full impact of coronavirus on the labour market in Wales.
ONS notes the LFS responses are weighted to 2018-based population projections that pre-date the coronavirus pandemic stating:
Rates published from the LFS remain robust; however, levels and changes in levels should be used with caution. This will particularly affect estimates for country of birth, nationality, ethnicity and disability.
For November 2020 to January 2021 the unemployment rate for people aged 16+ in Wales was 4.5%, compared to 4.6% in the previous quarter (August 2020 to October 2020). This is a decrease of 2,000 people from the previous quarter to 68,000.
The unemployment rate in Wales (4.5%) is lower than England (5.1%) but higher than Scotland (4.1%) and Northern Ireland (3.7%).
Percentage of people aged 16+ who are unemployed, UK nations; November 2015 – January 2016 to November 2020 - January 2021.
Source: ONS, Labour market in the regions of the UK: January 2021
Data from the LFS are available showing the unemployment rate by sex and age for 12 months to September 2020. The latest data show unemployment rates decrease with age for both males and females. In the 16-24 and 25-49 age groups males have higher unemployment rates than females.
Unemployment rate by age and sex in Wales; 12 months to September 2020
Unemployment data are also available by parliamentary constituency. The map below shows for the 12 months to September 2020 Swansea West had the highest rate (7.8%) and Carmarthen West and South Pembrokeshire the lowest rate (0.9%).
Note: The sample sizes in Cardiff Central and Cardiff West are too small to provide estimates.
Are there other data we can use to see the impact of coronavirus on the labour market in Wales?
Claimant count figures are published monthly and are more timely. However, people in work can also be eligible for Universal Credit and included in the claimant count. ONS states;
As part of the response to the pandemic, the rules about who can claim Universal Credit have changed, meaning an increased proportion of those claiming may actually still be in some kind of work. Because of these reasons, the change in the claimant count almost certainly ends up overstating any underlying change in unemployment.
ONS has also been working with HMRC to produce estimates of employees being paid through the PAYE system. The PAYE seasonally adjusted data from March 2020 to February 2021 showed a reduction of 24,000 people in Wales being paid through this system.
Claimant count – seasonally adjusted
ONS publishes an experimental series counting the number of people claiming Jobseeker's Allowance plus those who claim Universal Credit and are required to seek work and be available for work. This replaces the number of people claiming Jobseeker's Allowance as the headline indicator of the number of people claiming benefits principally for the reason of being unemployed. The latest data for February 2021 show that the Wales claimant count went up from 58,576 in March 2020 to 113,044 in February 2021, a slight increase from 109,785 in January 2021.
Claimant count for Wales; February 2019 to February 2021
Source, NOMIS, ONS Claimant Count – seasonally adjusted
Notes: From May 2013 onwards these figures are considered Experimental Statistics. Under Universal Credit a broader span of claimants are required to look for work than under Jobseeker's Allowance. As Universal Credit Full Service is rolled out in particular areas, the number of people recorded as being on the Claimant Count is likely to rise. Rates for regions and countries from 2018 onwards are calculated using the mid-2018 resident population aged 16-64.
The number of unemployed people in the UK includes people who meet the definition of unemployment specified by the International Labour Organisation (ILO). The ILO defines unemployed people as being:
- without a job, have been actively seeking work in the past four weeks and are available to start work in the next two weeks
- out of work, have found a job and are waiting to start it in the next two weeks
Employment measures the number of people aged 16 years and over in paid work. The headline measure of employment for the UK is the employment rate for those aged from 16 to 64 years.
The headline measure of inactivity for the UK is the rate of those aged from 16 to 64 without a job who have not sought work in the last four weeks and/or are not available to start work in the next two weeks.