With the cost of living and other economic factors in sharp focus, information on employment is invaluable. This article summarises a range of data published on the labour market in Wales.
What do the latest figures show?
The key trends in the labour market are:
- Employment levels and vacancies are high, while unemployment is at historically low levels.
- The number of people who are not economically active is rising.
- The ONS said the ratio of unemployed people to vacancies hit a record low, underscoring the hiring problems facing many employers in some sectors.
Inflation is currently exceeding wage growth causing the real value of wages to fall. There are signs of the levels of vacancies starting to fall and this will be expected to continue with economic growth stagnating and interest rates expected to rise.
Number of payrolled employees
ONS has been working with HMRC to produce timely estimates of employees being paid through the pay as you earn (PAYE) system. The number of payrolled employees in Wales is above the pre-pandemic level and has continued to increase in recent months.
PAYE seasonally adjusted data; five years to September 2022
Source: ONS PAYE – seasonally adjusted
Average weekly earnings
Year-on-year increases in average weekly earnings across the UK are below the rate of inflation. Earnings data for Wales is published on an annual basis in the Annual Survey of Hours and Earnings. However the inflation rate is not available at a Wales level.
Year-on-year change in UK average weekly earnings and inflation
At a UK level ONS publishes an estimate of the number of job vacancies for the preceding three months. These estimates are based on the Vacancy Survey where ONS surveys employers across all sectors of the economy. From July to September 2022 there were a reported 1,246,000 job vacancies in the UK, a decrease of 46,000 from April to June 2022. In June to August 2022 this data showed there were 0.9 unemployed people per job vacancy, a record low.
The Vacancy Survey data is not available at a Wales level, however ONS publishes experimental indices of online job adverts. This includes information on several million job advert entries each month from across the UK, broken down by job category and UK countries. The post-pandemic surge in job vacancies peaked in November 2021 and has decreased overall since.
Index of estimated number of online job adverts (Feb 2020 = 100)
As more people move from legacy benefits to Universal Credit, the claimant count measure of unemployment has changed. The experimental headline data published by the ONS covers 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.
The claimant count more than doubled at the start of the pandemic. The numbers steadily decreased from August 2020 to July 2022. The last two months have shown consecutive increases with the claimant count in September 2022 standing 11% above pre-pandemic levels.
Claimant count for Wales; five years to September 2022
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.
Labour Force Survey
The Labour Force Survey (LFS) is a quarterly household survey of around 80,000 adults. It asks a range of questions on employment and the results have traditionally been used as the main headline indicators of the labour market.
The estimates refer to the preceding three-month period. The time lag means that the latest labour market release published on 11 October 2022 provides information from June 2022 to August 2022.
For June to August 2022 the economic inactivity rate for people aged 16-64 in Wales was 25.3%, higher than 23.4% in the previous quarter (March to May 2022). This is an increase of 38,000 people to 484,000.
Labour Force Survey headline statistics for Wales, June to August 2022
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Changes are from the previous quarter, March to May 2022
The LFS shows that recent unemployment levels in Wales are close to pre-pandemic levels. This is similar to the trend at a UK level. Comparing across UK nations, the unemployment rate in Wales is below England and above Northern Ireland and Scotland.
Percentage of people aged 16+ who are unemployed, UK nations; five years to June - August 2022
Source: ONS, Labour market in the regions of the UK: October 2022
Data from the LFS is available showing the unemployment rate by sex and age for 12 months to June 2022. Due to the limited sample size, the confidence on these numbers is low. However, unemployment rates are significantly higher in the 16-24 age group than the 25-49 and 50-64 age groups.
Unemployment rate by age and sex in Wales; 12 months to June 2022
ONS explains they have made changes to the LFS:
Labour Force Survey (LFS) responses have been reweighted to new populations derived using growth rates from HM Revenue and Customs (HMRC) Real Time Information (RTI), to allow for different trends during the coronavirus (COVID-19) pandemic. The reweighting will give improved estimates of both rates and levels.
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.