Analysis and action on living standards
Our quarterly Labour Market Outlook lifts the lid on what’s happening beneath the bonnet of the UK labour market, and what’s in the pipeline for people’s pay and job prospects. Each edition includes a Spotlight article that focuses on an emerging labour market trend.
We also produce research on the labour market and labour market enforcement. We have further developed alternative employment estimates in response to recent issues with the ONS’s Labour Force Survey.
The Employment Rights Act marks the biggest overhaul of workers’ rights in a generation. But even the most ambitious employment rights will benefit workers only if they are enforced effectively. And compliance with existing labour market rights is already patchy:
Employment has fallen over the past two years and is substantially lower than it was before the pandemic. Perhaps surprisingly given its central place in policy debates, participation is essentially unchanged compared to pre-pandemic: rising inactivity due to ill-health has
Employment and the employment rate are falling according to Resolution Foundation estimates, but not according to the official statistics based on the Labour Force Survey (LFS). The official data also suggests that unemployment has risen by 0.5 percentage points over
Since the onset of the Covid-19 pandemic, significant issues have emerged with the ONS’s Labour Force Survey (LFS), which is the main source of the UK’s official labour market data. These issues have been picked up not only by us, but also by the Bank of England, the Office for Budget Responsibility and the ONS itself. Survey response rates collapsed and trends in employee numbers in the LFS diverged significantly from those in monthly payroll data and employer surveys, while estimates of self-employment dropped below those implied by tax data.
In response to these concerns, we have developed alternative employment estimates – going back to 2014 – based primarily on HMRC tax data (giving an estimate of employment), and on the ONS’s population estimates (giving the denominator, which can then be used to calculate an employment rate). These figures also have the advantage of being more timely than the LFS.
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