The UK employment rate has risen, marking a positive shift in the labour market.
- The number of payrolled employees fell by 0.1% between July and August 2024.
- Annual growth in average regular earnings stood at 4.9% for the same period.
- Pay growth is outpacing inflation, despite a slow-down in its pace.
- Job vacancies continue to decline across most industries, yet remain slightly above pre-pandemic levels.
The Office for National Statistics (ONS) released data showing an increase in the UK employment rate for individuals aged 16 to 64 to 75% between June and August 2024. This represents an improvement over the previous year and a rise from the previous quarter, although pay growth has shown signs of stalling.
The count of payrolled employees in the UK saw a marginal decrease of 0.1% to 35,000 between July and August 2024. Nevertheless, there has been a 0.5% increase, translating to 165,000 additional payrolled employees, when compared with August 2023.
Annual growth in average regular earnings, excluding bonuses, reached 4.9% from June to August 2024. Total earnings growth, including bonuses, was reported at 3.8%. In real terms, adjusted for inflation, regular pay saw a growth of 1.9%, while total pay increased by 0.9% over the same period.
David Freeman, from the ONS labour market and household division, highlighted that the previous year’s one-off payments to public sector workers continue to impact total pay figures. He noted that earnings are still growing faster than inflation. Freeman advised caution in interpreting changes due to variations in survey responses, and mentioned that payroll numbers have remained stable over recent months.
Despite the overall flat trend in payroll numbers, the job vacancies have decreased across most sectors. However, the total number of vacancies remains somewhat higher than the levels seen prior to the pandemic, indicating a complex but relatively stable employment landscape.
The UK labour market presents a mixed picture, with rising employment offset by slower pay growth and declining vacancies.
