1. Headline indicators

Employment in June 2024 rose by 77,000 on the previous month and increased by 61,000 on the January to March 2024 quarter, to 31.6 million. However, compared with the same quarter in 2023, the number of people of working age in employment was 145,000 lower in the April to June quarter of 2024. The employment rate for those aged 16 to 64 remained the same as the previous quarter, at 74.5%.

Economic inactivity for those aged 16 to 64 went up by 27,000 on the previous quarter to 9.4 million and has risen by 350,000 over the past year. The economic inactivity rate was almost unchanged on the last quarter, rising slightly from 22.1% to 22.2% in April to June 2024.

Unemployment (for those aged 16 to 64) fell by 44,000 compared with the previous quarter, to 1.4 million and has fallen by 30,000 over the past year. The unemployment rate in April to June 2024 fell slightly to 4.2% from 4.4% in the previous quarter.

2. Nominal pay rises continue to outstrip inflation

The latest data show average regular earnings grew by 5.4% in the year to June 2024, down from 5.8% in May 2024 and down from the post-pandemic peak of 7.9% in August 2023. For public sector workers average regular earnings grew by 6.0% in the year to June 2024, while average regular earnings grew by 5.2% for private sector workers. After taking account of inflation, real regular earnings went up by 2.4% (3-month average change) in the year to June 2024, with the single month data for June showing a real-terms increase of 2.2% over the year.

The rate of inflation has been falling since May 2023 and stood at 2.8% in June 2024. In the year to June 2024 core CPIH (excluding energy, food, alcohol and tobacco) rose by 4.2%, the same as the increase seen in the year to May 2024. Inflation in areas like Owner occupiers’ housing costs, Health, Recreation and culture, Education, and Restaurants and hotels is still high. The United States is currently experiencing an inflation rate of 3.0% while the Eurozone average is 2.5%. Weak growth since the global financial crisis means average earnings are around £12,000 per year lower than if pre-crisis trends had continued.

3. There are fewer potential workers for employers to recruit, with 1 million fewer over 50s in the labour market since the pandemic started

Recruitment has been more challenging for employers since the pandemic because of rises in economic inactivity – people leaving the labour market. The number of people aged 50 to 64 who are economically inactive has increased by 10.7% since the pandemic started.

Economic inactivity is almost unchanged in the most recent quarter, with the rate standing at 22.2% for those aged 16 to 64 in April to June 2024 – down from 22.1% in the previous quarter. Overall, the number of those aged 16 to 64 who are economic inactive is 859,000 higher than pre-pandemic, yet only one in ten out-of-work older people and people with a disability get employment support each year. The Government needs to extend employment support to more people outside the labour market and employers need to think about recruitment and job design to attract and retain staff.

4. Quarterly data on employment rates by ethnic group and by disability show substantial differences remain between groups

In the April to June quarter of 2024 the difference between the employment rates of people from a Bangladeshi or Black background and the employment rate of people from a White background narrowed compared with the same quarter in 2023. By contrast, the size of the gap between the employment rates of those from a White background and those from a Pakistani or Chinese background or those from Mixed/multiple or Other ethnic groups increased over this period. People from an Indian background are more likely to be employed than those from a White background and the size of this difference has increased over the past year.

As the figures on employment rates for different ethnic groups are not seasonally adjusted, patterns vary from quarter to quarter and the reweighting of the Labour Force Survey from the July to September quarter of 2022 onwards creates a discontinuity which makes it difficult to compare employment rates over a longer period of time. However, for most ethnic groups the gap in employment rates compared with those from a White background appears to have narrowed over the past 10 years.

The employment rate for people with a disability has generally been on an upward trajectory over the past 10 years. In the April to June quarter of 2024, 53.0% of people with a disability were employed, unchanged on the same quarter one year earlier. The difference in the employment rates of people with a disability and those without a disability has narrowed over time but remains substantial. In April to June 2024, the employment rate for people with a disability was 28.6 percentage points lower than the employment rate for those without a disability (81.6%).

5. The proportion of 16 to 24-year-olds not in employment or full-time education has risen over the past year

The unemployment rate for young people aged between 16 and 24 in the April to June 2024 quarter was 13.4%, 1.1 percentage points higher than the rate in the same quarter one year earlier (12.3%). The number of young people aged between 16 and 24 who are not in employment or full-time education currently stands at 1,090,000.

The percentage of those aged 16 to 17 who were not in employment or full-time education was higher in April to June 2024 compared with the same quarter one year earlier (8.2% and 7.4% respectively). Over the same period the percentage of 18 to 24-year-olds who were not in employment or full-time education rose from 16.2% to 17.2%. Our Youth Opportunity Index gives a detailed portrait of the opportunities and challenges for every young person broken down by local education authority.

6. Vacancies are gradually falling, but 1.8 million economically inactive want a job

Headline vacancies in the May to July 2024 quarter were down by 4,000 on the previous month, at 884,000, and 25,000 lower than in the previous quarter. The headline ONS vacancy figure is both seasonally adjusted and a three-month average. Using the official measure of unemployment, there are 1.6 unemployed people for every vacancy. However, there are an additional 1.8 million people who are economically inactive but want a job. Extending employment support to this group would potentially ease recruitment pressures for employers.

7. Numbers claiming unemployment-related benefits continue to exceed the ILO measure of unemployment

From those aged 16 or more, unemployment in the April to June 2024 quarter was 1,435,000. The quarterly headline figure has fallen by 51,000 since January to March 2024. The ONS figure for claimant unemployed is 1,801,000. Changes to work search requirements from May 2024 onwards have resulted in an increase in the numbers of claimant unemployed and so the steep rise in this series since May is at least partly due to this discontinuity. In June 2024 the number of unemployed people who were claiming unemployment-related benefits was 231,000 higher than the number unemployed on the official measure.

8. Some signs of recent increases in the unemployment rate across the age spectrum tailing off

The 16 to 24-year-old unemployment rate (including students) was 13.4% of the economically active in the April to June 2024 quarter. The rate for those aged 25 to 49 was 3.2%. For those aged 50 and over it is 2.4%. Compared with the previous quarter the unemployment rate has risen by 0.4 percentage points for 16 to 24-year-olds, while it has fallen by 0.2 percentage points for 25 to 49-year-olds and for those aged 50 or more.

9. Long-term unemployment starting to fall across the age range

Youth long-term unemployment (which can include students) is down by 25,000 over the last quarter and stood at 165,000 in the April to June 2024 quarter. Long-term unemployment for young people is normally counted as being unemployed for six months or more. Adult long-term unemployment on the survey measure was 242,000 in the April to June 2024 quarter. The number of people aged 25 and over out of work for 12 months was 2,000 lower in the most recent quarter than in the previous quarter (January to March 2024).