Labour market overview, UK - Office for National Statistics (2024)

• Average weekly earnings in Great Britain

• Earnings and employment from Pay As You Earn Real Time Information, UK

• Employment in the UK

• Labour market in the regions of the UK

• Vacancies and jobs in the UK

Latest data

Estimates for payrolled employees in the UK decreased by 35,000 (negative 0.1%) between July and August 2024, but rose by 165,000 (0.5%) between August 2023 and August 2024.

When looking at June to August 2024 (comparable with our Labour Force Survey (LFS) estimates), payrolled employees rose by 3,000 (0.0%) over the quarter and by 203,000 (0.7%) over the year.

The early estimate of payrolled employees for September 2024 decreased by 15,000 (0.0%) on the month but increased by 113,000 (0.4%) on the year, to 30.3 million. The September 2024 estimate should be treated as a provisional estimate and is likely to be revised when more data are received next month.

Increased volatility of LFS estimates, resulting from smaller achieved sample sizes, means that estimates of change should be treated with additional caution. We recommend using them as part of our suite of labour market indicators, alongside Workforce Jobs (WFJ), Claimant Count data, and Pay As You Earn (PAYE) Real Time Information (RTI) estimates.

The UK employment rate (for people aged 16 to 64 years) was estimated at 75.0% in June to August 2024, above estimates of a year ago, and increased in the latest quarter.

The UK unemployment rate (for people aged 16 years and over) was estimated at 4.0% in June to August 2024, below estimates of a year ago, and decreased in the latest quarter.

The UK economic inactivity rate (for people aged 16 to 64 years) was estimated at 21.8% in June to August 2024, below estimates of a year ago, and decreased in the latest quarter.

The UK Claimant Count for September 2024 increased on the month and on the year, to 1.797 million. Starting in May 2024, the Department for Work and Pensions are rolling out an increase in the administrative earnings threshold for full work search conditionality. This change is likely to affect around 180,000 claimants over a period of around six months, increasing the Claimant Count over that time.

The estimated number of vacancies in the UK decreased in July to September 2024, by 34,000 on the quarter to 841,000. Vacancies decreased on the quarter for the 27th consecutive period but are still above pre-coronavirus (COVID-19) pandemic levels.

Annual growth in employees' average regular earnings (excluding bonuses) in Great Britain was 4.9% in June to August 2024, and annual growth in total earnings (including bonuses) was 3.8%. This total annual growth is affected by the NHS and civil service one-off payments made in June, July and August 2023.

Annual growth in real terms (adjusted for inflation using the Consumer Prices Index including owner occupiers' housing costs (CPIH)) for regular pay was 1.9% in June to August 2024, and for total pay was 0.9%.

There were an estimated 31,000 working days lost because of labour disputes across the UK in August 2024.

In this section, we supply additional commentary to help users assess the different sources of data we publish on employment and related indicators.

Figure 1 shows the annual growth rates in a selection of our different employment indicators, with annual growth rates giving a more stable, longer-term view on changes. The LFS is our survey of households, while WFJ is based predominantly on business surveys for employee jobs, with the LFS covering self-employed jobs. HM Revenue and Customs (HMRC) PAYE RTI data are derived from administrative tax records and covers only payrolled employees.

Each of these sources are collected and processed in different ways so we do expect differences in levels, for example, jobs versus people, while divergent trends between individual periods are also possible. Further detail on how best to compare these different sources can be found in Coherence of data sources in Section 7: Data sources and quality and in our Comparison of labour market sources article.

As we have described in recent months, there have been ongoing challenges in assessing the coherence between these statistics. For the datasets available in the latest period, annual growth ranges from 0.7% for payrolled employees up to 1.2% for LFS employees. Though this is relatively coherent for this specific point in time, observing over a longer period of time shows differing trends in annual growth rates.

There had been a consistent slowdown in annual growth across all three sources over the last year, though the latest two periods have seen accelerating positive annual growth for both LFS measures of employment, with the latest period showing particularly strong growth rates. In the year to June to August 2024, the number of LFS employees grew by 1.2%, compared with growth of 0.4% in July to September 2023 (the earliest comparable period).

Annual growth in the latest measures from WFJ and RTI, however, have continued to slow. Annual growth in the number of payrolled employees as measured by RTI has declined from 1.8% a year ago to 0.7% for June to August 2024.

As outlined in last month's Labour market overview, the longer-term broad coherence between WFJ and RTI when looking at annual change suggests that these sources are likely to be providing a more reliable read on employment, particularly for employees. These sources continue to indicate that we have seen a sustained moderation of growth in employment over the last year. These two sources also show less volatility than the LFS over the same time period.

Despite these coherence challenges, the LFS continues to be the sole source of data for unemployment, economic inactivity and the self-employed. There are also a range of breakdowns that are only possible from LFS data.

As external sources are suggesting that recent increases in LFS measures of employment are likely to be overstating underlying employment growth, we expect that underlying changes in the other labour market statuses will also be affected. For example, the more modest growth we see in alternative employment sources may indicate that unemployment and/or economic inactivity have fallen by less than the LFS has recently suggested.

It is alsolikely that some of the recent movements in LFS estimates are being affected by the increased sample size and change in data collection methods introduced over the last year, in addition to any underlying changes in the labour market.

We are continuing to improve the quality of the LFS, building on our work to date, which as our Performance and quality monitoring reportshowed, has led to an increase in achieved interviews. Work is also under way to carry out a further reweighting of our LFS estimates, detailed in our Labour market transformation article. The reweighted estimates are due to be published in December 2024, which we anticipate will improve coherence between LFS and other sources. With this work ongoing, we advise caution particularly when interpreting short-term change in the LFS, and encourage users to make use of a wide range of data sources where possible.

View all related data on our related data page.

Alternatively, Nomis provides free access to the most detailed and up-to-date UK labour market statistics.

Average weekly earnings

Average weekly earnings measure money paid by employers to employees in Great Britain before tax and other deductions from pay. The estimates are not just a measure of pay rises, because they also reflect, for example, changes in the overall structure of the workforce.

More high-paid jobs in the economy would have an upward effect on the earnings growth rate.

Economic inactivity

People not in the labour force are not in employment but do not meet the internationally accepted definition of unemployment. This is because they have not been seeking work within the last four weeks or they are unable to start work in the next two weeks. The economic inactivity rate is the proportion of people aged between 16 and 64 years who are not in the labour force. The Labour Force Survey estimates are official statistics in development.

Employment

Employment measures the number of people in paid work or who had a job that they were temporarily away from (for example, because they were on holiday or off sick). This differs from the number of jobs because some people have more than one job. The employment rate is the proportion of people aged between 16 and 64 years who are in employment. The Labour Force Survey estimates are official statistics in development.

Unemployment

Unemployment measures people without a job who have been actively seeking work within the last four weeks and are available to start work within the next two weeks. The unemployment rate is not the proportion of the total population who are unemployed. It is the proportion of the economically active population (people in work and those seeking and available to work) who are unemployed. The Labour Force Survey estimates are official statistics in development.

Claimant Count

The Claimant Count is an official statistic in development that measures the number of people who are receiving a benefit principally for the reason of being unemployed. Currently, the Claimant Count consists of those receiving Jobseeker's Allowance and Universal Credit claimants in the "searching for work" conditionality group.

Vacancies

Vacancies are defined as positions for which employers are actively seeking recruits from outside their business or organisation. The estimates are based on the Vacancy Survey. This is a survey of businesses designed to provide estimates of the stock of vacancies across the economy, excluding agriculture, forestry and fishing (a small sector for which the collection of estimates would not be practical).

Pay As You Earn Real Time Information

These data come from HM Revenue and Customs' (HMRC's) Pay As You Earn (PAYE) Real Time Information (RTI) system. They cover the whole population, rather than a sample of people or companies, and they will allow for more detailed estimates of the population. The PAYE RTI statistics are official statistics in development (previously called experimental statistics) because the methodologies used to produce the statistics are still in their development phase.

In June 2023, the Office for Statistics Regulation (OSR) published an assessment report of HMRC and Office for National Statistics (ONS) statistics on earnings and employment from PAYE RTI. HMRC and the ONS welcome OSR's assessment report and have developed an action plan focusing on the six requirements.

A more detailed glossary is available in our Guide to labour market statistics methodology.

The estimates presented in this bulletin contain uncertainty. For more information, see our Uncertainty and how we measure it methodology.

Information on revisions is available in our Labour market statistics revisions policy.

Information on the strengths and limitations of this bulletin is available in our Labour market overview, UK: April 2021 bulletin.

Further information is available in our Guide to labour market statistics methodology.

Accredited official statistics

On 7 June 2024, the Office for Statistics Regulation (OSR) introduced the new accredited official statistics badge, to denote official statistics that have been independently reviewed by the OSR. Accredited official statistics comply with the standards of trustworthiness, quality and value in the Code of Practice for Statistics.

This UK labour market bulletin includes a combination of accredited official statistics and official statistics in development (until September 2023, these were called "experimental statistics"). Read more about the change in our Guide to official statistics in development.

The following labour market outputs are accredited official statistics:

• Labour disputes (rapid review completed by the OSR in February 2023)

• Vacancy statistics (reviewed by the OSR in April 2022)

• Workforce Jobs (WFJ) (reviewed by the OSR in April 2022)

The following labour market outputs are official statistics in development:

• Labour Force Survey (LFS) estimates

• ONS Claimant Count

Labour Force Survey

We have been facing the challenge of falling response rates for household surveys, as have other comparable countries. This issue became more acute in the LFS data collected for August 2023. The LFS estimates due to be published in October 2023 were suspended because of quality concerns. We developed a comprehensive plan to address these concerns and reintroduce LFS, as described in our Labour Force Survey: planned improvements and its reintroduction estimates methodology.

As stated on 5 February 2024 in our Impact of reweighting on Labour Force Survey key indicators: 2024 article, from 13 February 2024 we have reinstated reweighted LFS estimates into our monthly publication. These LFS estimates are official statistics in development.

Reweighting does not address the volatility we have seen in recent periods and which we expect to see to some extent in the future, so we would advise caution when interpreting changes in headline rates and recommend using them as part of our suite of labour market indicators, alongside WFJ, Claimant Count data and PAYE RTI estimates.

As stated in our article published 18 July 2024, we are planning a further reweighting exercise, based on the population projections published in January 2024. We plan to introduce the reweighted LFS series into our labour market publication by the end of 2024.

Further information on response rates and other quality-related issues for the LFS can be found in our quarterly Labour Force Survey performance and quality monitoring reports.

Coherence of data sources

Understanding coherence challenges around the LFS continues to be a priority. As we have previously communicated, we are undertaking a further reweighting of LFS-based statistics, which is due to be published as part of our December 2024 publication of labour market statistics. Our expectation is that this will improve the coherence picture as strong population growth in recent years is incorporated into our estimates of all three labour market statuses. Though, the extent to which any gap for employment will be reduced is not yet clear.

Additionally, we are looking to refresh our work on reconciling estimates of employment from the LFS and WFJ. This work makes several adjustments to both LFS and WFJ estimates to try and account for known differences in concepts, coverage and measurement.

Before the coronavirus (COVID-19) pandemic, these adjustments could explain around 40% to 50% of the gap in jobs measured by the two sources. However, when last published in 2022, this percentage had decreased to below 30%.

These adjustments are based on a range of assumptions and data sources, some of which are now relatively dated. Therefore, we are starting work to refresh these data sources and assumptions where possible. This will help us to understand the extent to which recent divergence in trends can be explained by known differences between the sources.

We are also considering how to best consider coherence between HMRC's PAYE RTI data and WFJ. As the former is essentially focused on employees, we recommend comparison with the employee jobs component of WFJ to align coverage of populations. One other important difference is that the RTI statistics published each month are a measure of people, rather than jobs, as in WFJ. One option is to look at data published annually by HMRC on "employments", which are conceptually closer to jobs. Though only available up to the end of 2023, making this comparison between WFJ employee jobs and RTI employments suggests good coherence between these two sources in recent years.

Our Comparison of labour market data sources methodology compares data sources and discusses some of the main differences.

Labour market transformation

We have published a Labour market transformation article providing an update on the transformation of labour market statistics.

We welcome your feedback on this latest update and our plans. Please email us at labour.market. transformation@ons.gov.uk to tell us what you think.

Coronavirus

For more information on how labour market data sources were affected by the coronavirus (COVID-19) pandemic, see our Coronavirus and the effects on UK labour market statistics article.

Making our published spreadsheets accessible

Following the Government Statistical Service (GSS) guidance on releasing statistics in spreadsheets, we will be amending our published tables over the coming months to improve usability, accessibility and machine readability of our published statistics. To help users change to the new formats, we will be publishing sample versions of a selection of our tables and, where practical, initially publish the tables in both the new and current formats. If you have any questions or comments, please email us at labour.market@ons.gov.uk.