Labour market overview - April 2023

The latest ONS data, covering the three months to February 2023, show a labour market that continues to soften. The employment rate continues to increase, and unemployment remains low. Economic inactivity and vacancies are both falling.

The timeliest estimate of payrolled employees for March 2023 shows another monthly increase, up by 31,000 to 30 million, driven by part-time and self-employed workers.

But vacancies fell for the ninth consecutive quarter – this time by 47,000 to 1,105,000. Although they remain higher than pre-pandemic levels, ONS states that survey respondents continue to cite economic pressures as a factor in holding back on recruitment.

348,000 working days were also lost because of labour disputes in February 2023, up from 210,000 in January 2023, and dominated by those in the education sector.

You’ll have heard us talk a lot about the importance of tackling economic inactivity as one solution to the issue of labour shortages. The economic inactivity rate decreased by 0.4% on the quarter, to 21.1%. This decrease was largely driven by people aged 16 to 24 years. But economic inactivity due to long-term sickness continues to rise – and stands now at 2.5 million, representing nearly 3 in 10 of those economically inactive.

Download the full Labour Market Update to find out:

• The state of the labour market across regions and nations
• How wage growth is developing in different sectors as well as the UK overall
• Where labour shortages are most acute