Recruiters' Edition February 2021 - FCSA
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February 2021 Recruiters’ Edition
February 2021
Contents
Page 3 - Commentary
Page 4 – Changes in Demand
Page 16 - Changes in Supply
Page 18 – UK Labour Market Statistics
2
February 2021
Commentary
Industry output down 15% in 2020 as self-employed
numbers plummet 13%, YoY, in Q4
Welcome to the February 2021 edition of the FCSA’s Workforce Barometer in which we continue to
seek to provide data and insights to support members with issues relating to the current pandemic.
This month’s report includes the latest data on the economic impact of the pandemic, including which
sectors have suffered most from redundancies and the impact on Zero Hours Contract working. We
also look at the change in self-employed worker numbers by sector to chart the potential fall out from
the impending off-payroll reforms.
Despite a rally towards the back end of 2020, the all-industry UK economic output was 9.9% lower
across the year than in 2019. In comparison, the employment activities sector recorded output
14.7% lower than in the prior year.
As a backdrop to the on-going challenges facing the industry, whilst not all self-employed work on a
freelance basis into UK plc, the dramatic fall in self-employment numbers – ending the year 13.0%
(652k) lower in Q4 2020 than in Q4 2019 – is undoubtedly hampering the industry’s recovery. And,
whilst temporary employment numbers are buoyant (up 10.0% / 142k, YoY, in Q4 2020), it is the rise
in FTC working that is causing the upward spike, as we evidenced last month.
Looking at the sectors most impacted by the fall in self-employed numbers – carrying 64% of the
losses between them - some are likely casualties of the impending off-payroll reforms:
• A 23% (86k) YoY fall in the number of self-employed engaged within Health & Social Work
• A 20% (62k) fall in the number of self-employed Transport & Storage Workers
• A 22% (86k) fall in the number of self-employed engaged in Admin & Support Services
• A 15% (62k) fall in self-employed workers in Wholesale & Retail
• A 13% (119k) fall in self-employed Construction Workers
Whilst these falls are stark, we continue to hear evidence from members of an increasing number of
employers rationalising and formalising their agency PSL who, in turn, are doing the same with their
supply chain partners – notably in favour of FCSA accredited organisations. With just one month to
go, never has there been a more pressing time to stress the importance of such moves.
Phil Pluck, CEO FCSA
3
February 2021
Changes in Demand
9.9% lower UK economy output across 2020:
14.7% lower in the employment activities sector
Following a 2.7% dip in GDP growth in November, UK output improved by 1.0% in December
rendering it 6.3% below pre-pandemic levels. Across 2020, UK output was 9.9% lower than the prior
year. The fall in 2020 was more than twice the next largest fall of 4.0% in 2009, driven by significantly
weaker growth from services – the historical driver of 80% UK GDP
Figure 1. UK monthly GDP Index: January 2007 - December 2020
110
Monthly Index, 2018 = 100
105
100
95
90
85
80
75
70
Figure 2. 2020 GDP versus 2009 output
-8.9
Index of Services
-2.5
-8.6
Index of Production
-7.8
-12.5
Construction
-13.2
%
-14 -12 -10 -8 -6 -4 -2 0
2020 2009
Source for both: FCSA analysis of ONS data
Across the employment activities sector, an end of year rally resulted in full-year output 14.7%
lower than the prior year.
4
February 2021
Changes in Demand
Number of hours worked: the barometer to watch
Between July - September and October - December 2020, the total actual weekly hours worked by
those in employment in the UK increased by 53.7 million, or 5.8%, to 978.7 million hours. Over the
same period, average actual weekly hours increased by 1.8 hours to 30.2 hours.
Over the year, total actual hours worked in the UK decreased, however, by 72.4m (6.9%), to
978.7 million - a fall of 1.7 hours per week to 30.1.
Figure 3. UK total actual weekly hours worked (people aged 16 years and over), seasonally
adjusted, between Oct - Dec 1992-2020 (000s)
1,100.0
1,050.0
1,000.0
950.0
900.0
850.0
800.0
Oct-Dec 1992
Apr-Jun 1993
Oct-Dec 1993
Apr-Jun 1994
Oct-Dec 1994
Apr-Jun 1995
Oct-Dec 1995
Apr-Jun 1996
Oct-Dec 1996
Apr-Jun 1997
Oct-Dec 1997
Apr-Jun 1998
Oct-Dec 1998
Apr-Jun 1999
Oct-Dec 1999
Apr-Jun 2000
Oct-Dec 2000
Apr-Jun 2001
Oct-Dec 2001
Apr-Jun 2002
Oct-Dec 2002
Apr-Jun 2003
Oct-Dec 2003
Apr-Jun 2004
Oct-Dec 2004
Apr-Jun 2005
Oct-Dec 2005
Apr-Jun 2006
Oct-Dec 2006
Apr-Jun 2007
Oct-Dec 2007
Apr-Jun 2008
Oct-Dec 2008
Apr-Jun 2009
Oct-Dec 2009
Apr-Jun 2010
Oct-Dec 2010
Apr-Jun 2011
Oct-Dec 2011
Apr-Jun 2012
Oct-Dec 2012
Apr-Jun 2013
Oct-Dec 2013
Apr-Jun 2014
Oct-Dec 2014
Apr-Jun 2015
Oct-Dec 2015
Apr-Jun 2016
Oct-Dec 2016
Apr-Jun 2017
Oct-Dec 2017
Apr-Jun 2018
Oct-Dec 2018
Apr-Jun 2019
Oct-Dec 2019
Apr-Jun 2020
Oct-Dec 2020
Total actual weekly hours
Source: FCSA analysis of ONS data
Underpinning this barometer are two issues creating continuing cause for concern:
o Firstly, there has been a sharp rise in the number of employees remaining officially at work
but not getting paid. This is likely to be, in part, due to those on Zero Hours Contracts –
recorded at 978k in October - December 2020 - who are still appearing in the Labour Market
Statistics as employees but for whom there is no work. This number rose to 278k in
November and to 307k in December after declining to 211k in October.
o Secondly, as we evidenced in previous reports with specific company examples, many
employers have actioned reduced hours for reduced pay policy, from which it is uncertain
how soon or for how many hours will ever be restored. As such, it is not just the rate of
unemployment that we must watch, but also the quantity of work – and corresponding pay –
being done by those in work.
Never, in previous economic downturns, has the average working week been cut so severely.
5February 2021
Changes in Demand
As such, the other barometer to watch is how average working hours rebound amongst full-time, part-
time, and all workers. In relation the same period last year (October - December 2019):
• All worker hours were 5.2% lower
• Full-time worker hours were 5.4% lower
• Part-time worker hours were 7.8% lower
Ongoing economic impacts of the pandemic
Just 72% of UK businesses were operating In the period 8-21 February 2021 – only marginally
higher than the lowest weighted total on record since the start of the pandemic (66% in 15 to
28 June 2020). By size of enterprise, 71% of micro businesses are currently trading, compared with
88% of businesses with 250 or more employees.
Figure 4. The proportion of UK businesses (%) that were trading or had temporary closed /
paused trading, June 2020 – Feb 2021
100
86.3 86.1 84.6
90 82.4 81.5 82.7 83.9 84.4
81.6
80 80.4
72.5 72.2
78.5
70 77.1
71.6 71.0
60 70.6
65.9
50 Currently trading (%)
40
30
20
10
0
Jun-20 Jul-20 Jul-20 Aug-20 Aug-20 Aug-20 Sep-20 Sep-20 Oct-20 Oct-20 Nov-20 Nov-20 Dec-20 Dec-20 Jan-21 Jan 21 Feb-21 Feb 21
Source: FCSA analysis of ONS data
By way of the impact on company turnover, 46% of UK businesses reported that turnover was lower
than normally anticipated at this time of year, compared to 6% who stated that it was higher. The
wholesale and retail trade has the highest proportion with positive revenues (11%).
6February 2021
Changes in Demand
Figure 5. Turnover was lower than prior year: percentage of enterprises, 25 Jan-7 Feb 2021
All Industries -46 38 6
Accom & Food Service -76 11 5
Arts, Ent & Recreation -73 15 4
Education -58 30 4
Wholesale & Retail Trade -50 31 11
Admin & Support Service -49 36 6
Transportation & Storage -48 38 6
Manufacturing -45 40 8
Construction -40 45 4
Utilities -37 47 7
Prof, Scientific & Technical -35 51 4
Human Health & Social Work -34 51 4
Real Estate -30 49 9
Info & Comms -26 57 6
-90 -70 -50 -30 -10 10 30 50 70
Turnover has decreased (%) Turnover has not been affected (%) Turnover has increased (%)
Similar proportions of businesses reported lower profits (44%) than last year, rather than higher levels
(6%).
Figure 6. Profits were lower than prior year: percentage of enterprises, 25 Jan-7 Feb 2021
All Industries -44 36 6
Accom & Food Service -71 13 7
Arts, Ent & Recreation -58 18 2
Education -48 26 3
Admin & Support Service -51 30 5
Wholesale & Retail Trade -47 31 8
Construction -42 43 1
Manufacturing -40 41 6
Transportation & Storage -46 35 7
Human Health & Social Work -31 44 3
Real Estate -35 43 7
Prof, Scientific & Technical -33 47 5
Utilities -45 38 8
Info & Comms -24 55 5
-80 -60 -40 -20 0 20 40 60 80
Profits have decreased (%) Profits have stayed the same (%) Profits have increased (%)
Source for both: FCSA analysis of ONS data
7February 2021
Changes in Demand
Despite CJRS, SEISS and other scheme funds and rates exemptions, 32% of businesses that
had not permanently stopped trading, as at 25 January - 7 February, had either no (5%) or less than
3 months’ cash reserves (27%).
Far from these just being in sectors challenges with lockdowns, they are spread across all industries.
Those with increased proportions with no cash reserves this month included Construction, Admin &
Support Services and Health & Social Work.
Figure 7. Cash reserves amongst enterprises that have not permanently stopped trading, by
industry 25 Jan - 7 Feb 2021
5% 27%
All Industries
Information And Communication
Utilities
Education
Real Estate Activities
Manufacturing
Transportation And Storage
Wholesale And Retail Trade
Professional Scientific And Technical…
Human Health And Social Work Activities
Arts Entertainment And Recreation
Administrative And Support Service…
Construction
Accommodation And Food Service…
Other services
0 10 20 30 40 50 60
No cash reserves Less than 3 months
Source: FCSA analysis of ONS data
Redundancies abated as furloughing, once again,
protects workers
Just 232 employers submitted HR1 forms to the Insolvency Service in January 2021 – the lowest
figure since the pandemic began. Between them, these employers were proposing 32,000
redundancies from their workforces – a rise of 9% on the figure for January 2020, however.
Additionally, as there is no requirement for consultations on redundancies of fewer than 20 to be
notified, tens, or potentially hundreds of thousands of workers will not be included in these numbers.
8February 2021
Changes in Demand
Figure 18 Employer numbers and aggregate volumes from HR1 submissions, Jan 2019-21
To further set the 2020 spike in context, the dramatic quarterly rise in numbers being made redundant
– despite furloughing – compares starkly to the picture in 2009 when the last economic downturn hit.
Whilst numbers declined in October - December 2020, to 343k from 395k in September - November,
this was still higher than the 2009 peak.
Figure 9. Redundancies in the preceding 3 month period, Oct-Dec 2007-2020 (000s)
450
400
Number of people made redundant in the preceding 3 months
350
300
250
200
150
100
50
0
Oct-Dec 2007
Jan-Mar 2008
Apr-Jun 2008
Oct-Dec 2008
Jan-Mar 2009
Apr-Jun 2009
Oct-Dec 2009
Jan-Mar 2010
Apr-Jun 2010
Oct-Dec 2010
Jan-Mar 2011
Apr-Jun 2011
Oct-Dec 2011
Jan-Mar 2012
Apr-Jun 2012
Oct-Dec 2012
Jan-Mar 2013
Apr-Jun 2013
Oct-Dec 2013
Jan-Mar 2014
Apr-Jun 2014
Oct-Dec 2014
Jan-Mar 2015
Apr-Jun 2015
Oct-Dec 2015
Jan-Mar 2016
Apr-Jun 2016
Oct-Dec 2016
Jan-Mar 2017
Apr-Jun 2017
Oct-Dec 2017
Jan-Mar 2018
Apr-Jun 2018
Oct-Dec 2018
Jan-Mar 2019
Apr-Jun 2019
Oct-Dec 2019
Jan-Mar 2020
Apr-Jun 2020
Oct-Dec 2020
Jul-Sep 2008
Jul-Sep 2009
Jul-Sep 2010
Jul-Sep 2011
Jul-Sep 2012
Jul-Sep 2013
Jul-Sep 2014
Jul-Sep 2015
Jul-Sep 2016
Jul-Sep 2017
Jul-Sep 2018
Jul-Sep 2019
Jul-Sep 2020
Source: FCSA analysis of ONS data
Recently published ONS data also evidences the sectoral impact of redundancies through to
September - November 2020, which shows the aggregate redundancy rate increased to a record
high of 14.2 per thousand employees between July and November 2020. The redundancy rate
for men (15.5 per thousand) was higher than that for women (12.8 per thousand).
9February 2021
Changes in Demand
The September to November data (reporting redundancies that occurred between July and
November) show that the Administrative & Support services industry had the highest
redundancy rate (35.8 per thousand employees) followed by the Other Services industry group,
which includes Arts, Entertainment & Recreation (30.5 per thousand employees). The lowest
redundancy rate was in the Public Administration, Defence & Social Security industry, at 3.3 per
thousand employees.
Figure 10. Redundancies per 1,000 employees, by sector: Jan-Mar to Sept-Nov 2020
40 All
redundancies
Agriculture, fishing,
energy & water
35
Manufacturing
Construction
30
Wholesale, retail &
repair of motor vehicles
25
Transport & storage
Accommodation & food
20 services
Information &
communication
15 Financial, insurance &
real estate activities
Professional, scientific
& technical activities
10
Administrative &
support services
Public admin &
5 defence; social security
Education
0 Human health & social
work activities
Other services
Source: FCSA analysis of ONS data
10February 2021
Changes in Demand
As to future expectations – with employers now looking at the potential closure of the CJRS a the end
of April 2021 – the forecasts obtained by the ONS in early February (25 January–7 February 2021)
now provide a window into the likely fallout of a cliff-edge scenario. Almost 9% of those within
Accommodation & Food Services plan to make cuts as do 5% in Admin & Support Services.
Figure 11. Percentage of employers planning redundancies in the next three months (25 Jan -
7 Feb 2021)
10.0%
8.8%
9.0%
% of employers planning to make redundancies in the next 3 months
8.0%
7.0% 6.5%
6.0%
5.0%
5.0% 4.4%
3.7% 3.5%
4.0% 3.2% 3.4%
2.8%
3.0% 2.5%
2.0%
2.0% 1.2%
1.0%
0.0% 0.0% 0.0%
0.0%
Source: FCSA analysis of ONS data
A study by the Resolution Foundation, Long Covid in the Labour Market, evidenced that the
number of workers who in January had been on full furlough for at least six months (475,000) is
nearly as large as the number of people in January who we estimate had been unemployed for at
least six months (689,000). Altogether, 1.9 million people had spent the past six months
unemployed or on full furlough (including those who have experienced a combination of
unemployment and full furlough, without reaching six months of either individually).
Furthermore, according to the study, 8% of workers currently employed either expect to lose their
jobs in the next three months, or have been told they would be made redundant. This figure
rises to 21% among those who have been furloughed for at least six months of the crisis.
11February 2021
Changes in Demand
UK workforce impacts: furloughed numbers surge
again in January
In their Economic & Fiscal Outlook report in late November, the OBR forecast that an average of
4.5m workers would be fully or partially furloughed across the period November to March
2021, starting with 5.9m in November, dropping to 3.3m by March.
In complete contrast to the forecasts, the figures started much lower than anticipated (3.87m in
November and 3.82m in December, according to provisional figures from HMRC).
Following the move into Lockdown 3 at the end of December, however, numbers rose to 4.7m
(HMRC provisional) by the end of January 2021.
• This was largely driven by an increase in the numbers on full furlough (Figure 15),
which rose to an average of 3.3m across January (68% of all furloughs) from an
average of 2.3m (60%) across December.
• In contrast, the number on partial furlough dropped from c.1.5m (38% of all furloughs)
to c.1.4m (28%).
Furthermore, weekly estimates from ONS surveys show a continuing rise into February – up to
c.20% by the month end. This would equate to 6m now on furlough.
Figure 12. Furlough estimates amongst business not permanently stopped trading, March
2020 – Feb 2021
35
31.3 29.8 29.6 ONS estmate: % workforce on furlough leave
30 28.4
28.1
25 19.9
18.3
24.6
20 17.1
22.3 16.9
15.5
15 15.4 19.2
15.5 15.1 13.7
10 13.7
11.9 10.8
9.4 9.3 9.0
5
7.7
0
Source: FCSA analysis of ONS data
12February 2021
Changes in Demand
Two thirds of furloughed workers remain fully
furloughed
Figure 13. Proportions of furloughed workers on full or partial furlough, or their status
underdetermined, 31 July 2020 – 31 January 2021
100%
90% Furlough
20.8% 28.4% status
80% 31.0%
39.3% 40.7% 35.4% 38.0% undetermin
70% ed
60%
50%
Partially
40% furloughed
73.6%
65.8% 67.6%
30% 58.9% 56.5% 61.0% 59.9%
20%
10%
Fully
0% furloughed
31 July 31 Aug 30 Sept 31 Oct 30 Nov 31 Dec 31 Jan
2020 2020 2020 2020 2020 2020 2021
(HMRC) (HMRC) (HMRC) (HMRC) (HMRC) (HMRC) (HMRC
provisional)
Source: FCSA analysis of HMRC data
ZHC workers still number just shy of 1 million
New ONS data relating to Zero Hours Contract (ZHC) working shows that, having peaked at 1,059k in
Q2 2020, the numbers declined in Q3 (to 957k) before rising again in Q4 (to 978k) – a similar level to
Q4 2019 (974k).
The numbers of UK nationals on ZHCs averaged 852k across 2020 compared to 761k in 2019.
Similarly, the average amongst non-UK nationals was 141k in 2020, compared to 112 across 2019.
Non-UK national numbers declined sharply across the last quarter of the year, however, whilst UK
national numbers rose sharply (as they did in Q2).
13February 2021
Changes in Demand
Figure 14. Number of UK nationals and non-UK nationals on a ZHC, Oct-Dec 2013-2020 (000s)
1,200
UK nationals on a ZHC Non UK nationals on a ZHC
1,000
800
600
400
200
0
Oct-Dec Apr-Jun Oct-Dec Apr-Jun Oct-Dec Apr-Jun Oct-Dec Apr-Jun Oct-Dec Apr-Jun Oct-Dec Apr-Jun Oct-Dec Jan-Mar Apr-Jun Jul-Sep Oct-Dec
2013 2014 2014 2015 2015 2016 2016 2017 2017 2018 2018 2019 2019 2020 2020 2020 2020
In its Labour Market reports, the ONS notes that it is likely that, whilst many ZHC workers remain
officially employed, there are little or no hours for these workers. As such, the similar numbers
remaining on the payroll, year-on-year, is potentially understandable. This likelihood appears borne
out in the underemployment data for ZHC workers, which shows that there was a spike to 34.5%
reporting underemployment in Q4 2020.
Figure 15. Employees on ZHC / not on ZHC reporting underemployment, Oct-Dec 2013-20 (%)
40.0
34.5
35.0 31.8
31.4 27.9
30.0 27.3 26.5 25.3 26.5
28.9 27.9 24.1
25.0
26.2 26.8 26.1 25.4 26.5
22.1
20.0
All workers on a ZHC: % reporting underemployment
15.0
All workers not on a ZHC: % reporting underemployment
10.0
5.0
0.0
Oct-Dec Apr-Jun Oct-Dec Apr-Jun Oct-Dec Apr-Jun Oct-Dec Apr-Jun Oct-Dec Apr-Jun Oct-Dec Apr-Jun Oct-Dec Jan-Mar Apr-Jun Jul-Sep Oct-Dec
2013 2014 2014 2015 2015 2016 2016 2017 2017 2018 2018 2019 2019 2020†1 2020†r 2020† 2020†
Source for both: FCSA analysis of ONS data
14February 2021
Changes in Demand
Job postings at c. 81% of the prior year levels
In the week ending 12 February 2021, data from Adzuna, reported by the ONS, showed that the total
number of online job adverts had reached 81% of the level in the same week a year earlier.
Figure 16. Weekly UK job vacancy index, versus same week in previous year
120
100 12/02/21
81%
80
60
40
Adzuna weekly vacancies…
20
0
Out of the 27 Adzuna categories listed below, just 4 occupational groupings had returned to prior year
levels, however. Regionally, rates range from 110% of prior year job ad numbers in Northern Ireland
to 66% in London.
Figure 17. Adzuna Job Ad category index, w/e 12 Feb 2021 versus the same week last year
140
128 125 Job vacancy index: 12 Feb 2021 v same week last year (%)
115
120 105
98 96
100 90 88
82 80 78 78 76 81
74 76
80 71 70 69 68
64 62 61
57 54
60
46
40
23
20
0
Source for both: Adzuna, reported by ONS
15February 2021
Changes in Demand and Supply
Figure 18. Adzuna regional Job Ad index: w/e 12 Feb 2021 v last year
120%
110%
100% 94% 95% 89%
87% 87% 86%
81% 79% 77%
80%
76% 75%
75%
60% 66%
40%
20%
0%
All England Wales Scotland Northern North North Yorkshire East West East of London South South
Regions Ireland East West and The Midlands Midlands England East West
Humber
Job ad volumes (%), w/e 12 Feb 2021 versus the same week last year
Source: Adzuna, reported by ONS
Company incorporations remain high
In the week ending 12 February 2021, there were a total of 16,882 company incorporations – a figure
10.5% higher than in the same week last year (15,116).
Having trended below prior-year figures since late February 2020, incorporation numbers jumped in
early May - around the time of the announcement of the Bounce Back Loan Scheme - and have since
remained higher than the previous year.
Figures 19. Number of weekly incorporations, Jan 2019 – Feb 2021
20000
18000
16000
14000
12000
10000
8000
6000
2019 2020 2021
4000
2000
0
Week 1
Week 2
Week 3
Week 4
Week 5
Week 6
Week 7
Week 8
Week 9
Week 10
Week 11
Week 12
Week 13
Week 14
Week 15
Week 16
Week 17
Week 18
Week 19
Week 20
Week 21
Week 22
Week 23
Week 24
Week 25
Week 26
Week 27
Week 28
Week 29
Week 30
Week 31
Week 32
Week 33
Week 34
Week 35
Week 36
Week 37
Week 38
Week 39
Week 40
Week 41
Week 42
Week 43
Week 44
Week 45
Week 46
Week 47
Week 48
Week 49
Week 50
Week 51
Week 52
16 Source: FCSA analysis of Companies House dataFebruary 2021
Changes in Supply
In contrast, the number of dissolutions was kept artificially low by the temporary suspension of strike-
offs/dissolutions on 2 April (through to 10 September), since which time they have started to increase
but continue to trend below prior year figures. And notably, by w/e 12 February 2021, at 5,659, they
were 7.8% lower than in the same week last year (6,140).
Figures 20. Number of weekly dissolutions, January 2019 – January 2021
9000
8000
2019 2020 2021
7000
6000
5000
4000
3000
2000
1000
0
Week 1
Week 2
Week 3
Week 4
Week 5
Week 6
Week 7
Week 8
Week 9
Week 14
Week 33
Week 50
Week 10
Week 11
Week 12
Week 13
Week 15
Week 16
Week 17
Week 18
Week 19
Week 20
Week 21
Week 22
Week 23
Week 24
Week 25
Week 26
Week 27
Week 28
Week 29
Week 30
Week 31
Week 32
Week 34
Week 35
Week 36
Week 37
Week 38
Week 39
Week 40
Week 41
Week 42
Week 43
Week 44
Week 45
Week 46
Week 47
Week 48
Week 49
Week 51
Week 52
Source: FCSA analysis of Companies House data
17February 2021
UK Labour Market Statistics
Furloughing continues to shield workers
The UK employment rate (the proportion of people aged from 16 to 64 who were in work) was 75.0% in
October - December 2020 - 1.5 percentage points lower than the same period last year and 0.3
percentage points up on the previous quarter (July-September 2020). This equated to 32,393k
people in work, in 34,685 jobs (in September – the latest available data - down 475k (1.4%) from
35,160k jobs in June 2020).
Figure 21. UK workforce composition, Oct-Dec 2020 and quarterly/annual changes
Category Number % of all in Change on Change from a year
(000) employment previous quarter earlier
All in employment 32,393 100% -114k -541k
Employees 27,895 86.1%
+48k +169k
(of which)
Zero Hours 978 3.0%
contract (Q4 2020) (3.5% of all
+21k +4k
employees employees)
(Q4 2020)
(of which) 1,564 4.8%
Temporary (5.6% all +110k +142k
employees employees)
Self-employed 4,374 13.5% -152k -652k
Source: FCSA analysis of ONS Labour Force Survey data
With the total workforce decreasing by 114k, rolling quarter-on-quarter, the balance was achieved by
39k (0.2%) more people working full-time and 153k (1.9%) fewer officially part-time
workers. This number includes a significant number of people registered as employed, however –
likely to include many of the UK’s 978k Zero Hours Contract workers - but receiving no hours or
money. A flash estimate from HMRC, from PAYE Real Time Information, shows 726k fewer
people on payrolls in early January 2021 than in February 2020 – and 2.5% (730k) lower than a
year earlier.
Year-on-Year, the balance of 541k fewer people in the workforce resulted from 560k (6.6%) less
people in part-time jobs and 19k (0.1%) more in full-time work.
18February 2021
UK Labour Market Statistics
Self-employment down 652k (13%), YoY, whilst temp up
142k (10%)
From a contingent worker perspective, self-employment fell 152k (-3.4%) QoQ. The self-
employment rate is now 13.5%. In contrast, temporary employment – in all its guises –
increased by 110k (7.6%), QoQ. The temp rate for the quarter was 4.8%. Year-on-year,
temporary employment also increased by 142k (10.0%), although this was largely courtesy of a
rise in FTC working. In contrast, self-employed numbers were 13.0% (652k) lower than a year
earlier.
5.1% (1.74m) unemployment: sharp rises amongst
older workers
The unemployment rate increased to 5.1% in October - December 2020 from 5.0% last rolling
quarter and 3.8% in the same period last year. At 1,744k, this represented a 121k (7.4%) increase
on the previous quarter and was 454k (35.2%) higher than the same period a year earlier:
• The estimated unemployment rate for men was 5.4% whilst it was 4.8% for women
• There were 124k (32.5%) more unemployed 18-24 year olds in October-December 2020 than
in the same quarter in 2019
o The rate was 15.4% amongst men & 11.3% amongst women (13.4% both)
• There were 208k (39.9%) more unemployed 25-49 year olds than a year earlier
• There was also a 47.8% (138k) YoY increase in unemployed people aged 50+
Figure 22. Unemployment numbers and rates, by age band, Oct-Dec 2020
Category Number Unemployment Change on Change from a
(000) rate previous quarter year earlier
16–17 year olds 82k 25.3% -7k -16k
18-24 year olds 507k 13.4% -5k
+124k
25-49 year olds 729k 3.8%
+79k +208k
50+ year olds 426k 3.9%
+54k +138k
Source: FCSA analysis of ONS data
19February 2021
UK Labour Market Statistics
At 307k in December, the number temporarily away
from work receiving no pay rose increased again
The increase in the officially unemployed number may be remaining artificially low as the
numbers in other groups who are out of work and could potentially be seeking employment is
countering it. Little has been published on this cohort this month, however, apart from the following:
• Estimates of the number of people in employment on the Labour Force Survey (LFS) are
consistent with the International Labour Organization (ILO) definition of employment
• Under this definition, employment includes both those who are in work during the reference
period and those who are temporarily away from a job
o The number of people who are estimated to be temporarily away from work includes
furloughed workers, those on maternity or paternity leave and annual leave
• Prior to the coronavirus (COVID-19) pandemic, there were on average 2 to 2.5 million people
temporarily away from work. The number of people temporarily away from work rose to
almost 7.9 million people in April to June 2020 but, by October 2020, had fallen to an estimate
of 3.7 million. It rose in November to 4.1m people, however.
• There were also around 307k people away from work because of the pandemic and
receiving no pay in December 2020. Whilst this has fallen from 658k in April 2020, it was
a notable increase from 211k recorded in October and 278k in November 2020.
2.6m low and no pay claimants – up 111% YoY
At 2,597k, the provisional Claimant Count in January 2021 was 20k (0.8%) lower than the
previous month but 1,368k (111.4%) higher than a year earlier.
Vacancy levels down 26%, YoY, but up 12% QoQ
There was an average of 599k job vacancies open across November 2020-January 2021 – a
quarterly increase of 12% (64k) vacancies. This figure was, however, 211k (26.0%) lower than a
year earlier.
20•
26,500,000
27,000,000
27,500,000
28,000,000
28,500,000
29,000,000
29,500,000
26,000,000
o
January 2015
February 2015
March 2015
April 2015
May 2015
June 2015
July 2015
August 2015
September 2015
October 2015
November 2015
December 2015
January 2016
February 2016
March 2016
April 2016
May 2016
across March 2020 – January 2021.
June 2016
July 2016
August 2016
September 2016
down 2.5% (730k) YoY
October 2016
November 2016
December 2016
January 2017
February 2017
March 2017
April 2017
May 2017
June 2017
July 2017
August 2017
UK Labour Market Statistics
21
September 2017
Payrolled employees
October 2017
November 2017
December 2017
January 2018
February 2018
March 2018
April 2018
May 2018
June 2018
July 2018
August 2018
September 2018
October 2018
November 2018
December 2018
January 2019
February 2019
March 2019
by 0.3% in January 2021 - equivalent to 83,000 people
April 2019
May 2019
June 2019
2.5% (730k) compared with the same period of the previous year
July 2019
August 2019
September 2019
October 2019
November 2019
December 2019
January 2020
February 2020
March 2020
Figure 23. Paid employees, seasonally adjusted – to Jan 2015-2021
April 2020
May 2020
June 2020
July 2020
August 2020
September 2020
October 2020
November 2020
December 2020
January 2021
Workers on payroll in January up 0.3% (83k) MoM, but
HMRC analysis of RTI returns has enabled a flash estimate of the significantly reduced UK payrolls
Compared with the previous month, the number of payrolled employees increased
In January 2021, HMRC estimates that there were 28.3 million payrolled employees, a fall of
Source: FCSA analysis of HMRC data
February 2021February 2021
UK Labour Market Statistics
Real-terms pay growth continues to surge, due to a
reduction in the number of lower paid jobs
In real-terms (when adjusted for CPI), regular pay growth (for GB employees, excluding bonuses)
continued to surge in the year to October - December 2020, recovering to +3.3% (up from 2.8% last
rolling quarter). Similarly, real-terms total pay growth further improved to 3.8% in the year to October-
December 2020 from an adjusted 3.0% last rolling quarter. Moreover, for the single month of
December, real-terms regular pay improved by 3.6% whilst real-terms total pay rallied
significantly by 4.4%.
o The higher percentage growth figure for total pay reflected an increase in bonus payments,
because of bonus payments being postponed from earlier in the year.
Between October to December 2019- 2020, average pay growth varied by industry sector.
o The finance and business services sector saw the highest estimated growth in total
pay, at 6.8%.
o All sectors saw positive growth, although construction (1.9%) and manufacturing (1.5%)
had smaller growth than the other sectors.
o This is an improvement on the growth rates in April to June 2020, the three-month
period with the biggest falls in average pay, when all these sectors except for the
public sector had negative growth rates.
Figure 24. Regular & Total Pay real-terms wage growth, year to Oct-Dec 2009-2020
5.0
+3.8%
4.0
+3.3%
3.0
2.0
1.0
0.0
-1.0
-2.0
-3.0
Dec 14
Dec 10
Dec 11
Dec 12
Dec 13
Dec 15
Dec 16
Dec 17
Dec 18
Dec 19
Dec 20
Dec-09
Regular Pay Total Pay
Source: FCSA analysis of ONS data
ONS has cautioned, however, that current average pay growth rates are being impacted upwards
by a fall in the number and proportion of lower- paid jobs compared with before the
coronavirus pandemic.
22February 2021
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