ONS releases experimental statistics on labour market this time

Due to what it describes as ‘increased uncertainty around the Labour Force Survey (LFS),’ the Office for National Statistics (ONS) has produced an alternative set of experimental statistics for the latest labour market statistics. The ONS’ decision to innovate the way in which it carries out the LFS is significant as for five decades it has been the body’s main source of data on the labour market. In a statement released by the ONS, it says: ‘Falling survey response rates is [sic] a challenge facing statistics agencies worldwide… at the ONS we are working hard to ensure we can keep producing trusted labour market metrics.’

Employment and unemployment

The experimental statistics imply that the employment rate in the three months to August fell by 0.3 percentage points to 75.7%. At the same time, unemployment saw a rise of 0.2 percentage points up to 4.2%.

Economic inactivity

The estimated figures for inactivity show a small rise of 0.1 percentage points up to 20.9%. In order to arrive at an estimate of the proportion of people who are economically inactive, the ONS has used other data sources – chiefly data on benefits – to adjust the information it has already gleaned from the LFS. Because of this, it is unable to identify what proportion of those who are classified inactive are inactive because they are carers, long-term sick, students, or for some other reason, in the way the body normally would.

Vacancies

Vacancies fell on the quarter for the 15^th consecutive period. The estimated number of vacancies fell by 43,000 on the quarter to 988,000. Some 14 of the 18 industry sectors have seen a fall in vacancies.

The latest figures, experimental as they are, indicate further slight loosening of the labour market, with slightly lower employment, a small rise in unemployment and a further fall in vacancies. But inactivity looks to have risen again, and since inactivity presents as a factor in labour market tightness (because people in this category are neither working nor looking for work, unlike the unemployed, who are seeking work), this is an offsetting element to the effects of the figures on employment and unemployment. In addition, while the number of vacancies has fallen, it still remains high compared to the years before 2020. And unemployment remains low in comparison to earlier periods of weak economic growth or stagnation.