Recruiters' Edition February 2021 - FCSA
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
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. 5
February 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%). 6
February 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 7
February 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. 8
February 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). 9
February 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 10
February 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. 11
February 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 12
February 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). 13
February 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 14
February 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 15
February 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 data
February 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 17
February 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. 18
February 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 19
February 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 2021
February 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. 22
February 2021 Stay Connected with FCSA 23
You can also read