With COVID-19, each country’s economy bottomed out, which subsequently affected each country’s employment rate. Around 24% of the UK workforce was at risk during the lockdown. However, this year the statistics have taken a turn and people have witnessed the unusual, i.e., the number of job opportunities has increased in the UK than the unemployment rate.
The most astounding fact is that even in times of recession & peak inflation, Britain achieved a boom in its employment sector and for the first time in its life set a record for the most vacancies than unemployed people, according to the ONS labor market figures published in May 2022.
In addition, according to the numbers, there were 1,295,000 job vacancies (around 1.3 million) in March 2022, which is a first in UK history since 1974, with an unemployment rate of 3.7%.
In the ensuing months, however, the rate of growth in vacancies slowed. According to the CMI (Chartered Management Institute), the UK is experiencing “an upswing in its economy”.
Not only that, according to the statistics from January to March 2022, the average total salary of the employee increased by 7%, while the regular salary increased by 4.2%.
What are the ONS' key findings from the numbers and statistics?
The ONS Report on Employment Opportunities showed the rise and fall in various aspects. According to the Labor Force Survey, January-March 2022 estimates show a decline in the quarterly unemployment rate & an increase in the employment and inactivity rate.
Although statistics show that the employment rate increased from 0.1% to 75.7% in the quarter, it is still lower. The increase in the employment rate was observed in the age group of 16 to 64 (in years).
On the other hand, a massive movement of people from inactivity to employment has been observed, while from January to March 2022, 994,000 have been recorded moving from one job to another or switching jobs.
In addition, hours worked in a week increased by 14.8 million hours. to 1.04 billion hours from January to March 2022, which is still 10.7 million fewer than the weekly working hours before the pandemic.
Reactions from various sectors to the latest ONS figures
As the news broke and the ONS figures on job opportunities are more than unemployed in the UK, there were statements from prominent people across the UK.
Some of these are as follows:
1. CMI Policy Director Anthony Painter said,
“We have a boost that is picking up your economy. On the one hand, they trigger inflation, slow down growth and lower the cost of living. However, unemployment is at record lows and job openings are growing at a slower pace.
Something has to give way, and unfortunately it’s a bet that the impact of inflation and falling pay will weigh heavily on economic growth.
2. Chief Executive of Learning and Work Institute Director Stephen Evans noted:
“Real wages excluding bonuses experienced their largest monthly decline since 2013. This cost of living crisis is only going to get worse this year, so it’s vital that the government is doing more to help people, especially those on the lowest incomes. The obvious way to do this is to increase benefits, including Universal Credit, to match the price increase.
The labor market is less dynamic than it appears. For the first time on record, fewer people are unemployed than vacancies, and employers are finding it difficult to hire staff.
However, employment remains well below pre-pandemic levels due to the continued increase in older people exiting the labor market. Employers and the government must act quickly to get people back into the workforce.
3. Finance Minister Rishi Sunak commented:
“I understand these are troubling times for people, but it’s reassuring to know that fewer people are unemployed than previously feared, and we’re helping them get more of their hard-earned money through tax cuts, Universal Credit changes and… more to retain support with budget bills worth £22bn this financial year.
4. Steve Hains, director of public affairs at Youth Charity Impetus, said:
“If you’re a young person who needs support, no open position will suddenly prepare you for work. Government needs to be coordinated on the basis of the Kickstart program with a support package focused on the long-term needs of young people who are furthest from the labor market.” The TUC government is “absent in action” as the cost of living plummets The Trades Union Congress (TUC) blamed the UK Government for the nation’s cost-of-living crisis escalated and declared they were “missing from action”.
IES Analysis (May 2022)
With more vacancies than unemployed in the UK, there is hope that the workforce will regain strength after the pandemic. Statistics show that there are approximately 1.15 million fewer people in the workforce compared to the time of pre-COVID.
About 0.5 million people are economically inactive due to illness, job gaps, ethnic minorities etc., However, there is a stream of people going in and out of economic inactivity. and employment. Still, the inactivity-to-work graph is much flatter, even when there are many vacancies. The government has been observed to cut employment support when it is in surplus.
The only solution is a ‘Plan for Participation’ involving both government and employers to encourage and engage more people in employment, improve workplace support and improve job design.
