1. Headline indicators

Employment in October 2024 rose by 23,000 on the previous month and by 130,000 on the May-July 2024 quarter, to 32,225,000. The employment rate for those aged 16-64 went up to 74.9% from 74.7% in the previous quarter.

Economic inactivity for those aged 16-64 fell by 67,000 on the previous quarter to 9.34 million. The economic inactivity rate fell to 21.7% from 21.9% in the last quarter.

Unemployment (for those aged 16-64) went up by 26,000 compared with the previous quarter to 1.47 million. The unemployment rate rose to slightly to 4.4% from 4.3% in the previous quarter.

To explore how key labour market indicators have changed over the past 10 years, see our interactive labour market dashboard.

2. Divergence between the Labour Force Survey and other sources in recent years

Our headline indicators are based on data from the Labour Force Survey, but since the pandemic this has experienced a decline in the response rate which affects the reliability of estimates from this source. This is illustrated by the divergence in the employment rate estimated from the LFS and other sources over this period. To help with analysis while the ONS seeks to resolve these issues, we are publishing an experimental estimate of the employment rate based on an approach developed by the Resolution Foundation and using administrative data sources, such as HM Revenue and Customs payroll and self-assessment data on the numbers of people self-employed. This measure indicates that in October 2024 the employment rate for those aged 16 to 64 stood at 76.0%. This was 1.1 percentage points higher than the LFS estimate. We aim to refine this approach in the months ahead.

3. Nominal pay rises continue to outstrip inflation

The latest data show average regular earnings grew by 5.2% in the year to October 2024, up from 4.9% in September 2024 and down from the post-pandemic peak of 7.9% in August 2023. For public sector workers average regular earnings grew by 4.3% in the year to October 2024, while average regular earnings grew by 5.4% for private sector workers. After taking account of inflation, real regular earnings went up by 2.2% (3-month average change) in the year to October 2024, with the single month data for October showing a real-terms increase of 2.8% over the year.

The rate of inflation rose from 2.6% in September to 3.2% in October. In the year to October 2024 core CPIH (excluding energy, food, alcohol and tobacco) rose by 4.1%, slightly more than the 4.0% increase seen in the year to September 2024. This rise in the rate of increase was driven by recent reductions in the price of goods declining in magnitude while the price of services remained unchanged. The inflation rate for goods fell from -1.4% in September to -0.3% in October 2024 and the rate of inflation for services remained at 5.6% over the same period.

Inflation in areas like Housing and household services, Owner occupiers’ housing costs, Health, Communication and Education is still high. In October the UK had the highest rate of inflation in the G7. The United States is currently experiencing an inflation rate of 2.6% while the Eurozone average is 2.0%. Weak growth since the global financial crisis means average earnings are around £12,000 per year lower than if pre-crisis trends had continued.

4. There are fewer potential workers for employers to recruit, with nearly 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 9.9% since the pandemic started.

Economic inactivity has fallen slightly in the most recent quarter, with the rate standing at 21.7% for those aged 16-64 in August to October 2024 – down from 21.9% in the previous quarter. Overall, the number of those aged 16-64 who are economic inactive is 890,000 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.

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 August to October 2024 quarter was 13.9%, 1.7 percentage points higher than the rate in the same quarter one year earlier (12.2%). The number of young people aged between 16 and 24 who are not in employment or full-time education currently stands at 1,237,000.

The percentage of those aged 16-17 who were not in employment or full-time education was higher in August to October 2024 compared with the same quarter one year earlier (9.6% 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 17.0% to 18.9%. 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 1.9 million economically inactive want a job

Headline vacancies in the September to November 2024 quarter were down by 10,000 on the previous month, at 818,000, and 32,000 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 1.8 unemployed people for every vacancy. However, there are an additional 1.9 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 August to October 2024 quarter was 1,508,000. The quarterly headline figure has risen by 31,000 since May to July 2024. The ONS figure for claimant unemployed is 1,769,000. 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 October 2024 the number of unemployed people who were claiming unemployment-related benefits was 260,000 higher than the number unemployed on the official measure.

8. Unemployment rates fairly stable for older people and some signs the recent upward trajectory for those aged 16-24 is starting to tail off

The 16- to 24-year-old unemployment rate (including students) was 13.9% of the economically active in the August to October 2024 quarter. The rate for those aged 25 to 49 was 3.1%. For those aged 50 and over it is 2.6%. Compared with the previous quarter the unemployment rate has fallen by 0.4 percentage points for 16 to 24-year-olds and risen by 0.1 percentage points for those aged 25 to 49 and those aged 50 or more. Compared with the August to October quarter of 2023, the unemployment rate for 16 to 24-year-olds was 1.7 percentage points higher in the same quarter in 2024, while it was virtually unchanged (0.1 percentage points lower) for those aged 25 to 49 and only slightly higher (up by 0.3 percentage points) for those aged 50 or more.

9. Long-term unemployment rising for young people

Youth long-term unemployment (which can include students) is up by 29,000 over the last quarter and stood at 206,000 in the August to October 2024 quarter. It also rose by 47,000 over the past year. 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 234,000 in the August to October 2024 quarter. The number of people aged 25 and over out of work for 12 months or more was 8,000 lower in the most recent quarter than in the previous quarter (May to July 2024). Compared with the same quarter one year earlier, adult long-term unemployment has risen by 47,000.

10. The employment picture varies across the country

The smaller sample sizes underlying regional estimates of employment and economic inactivity mean that caution is needed in interpreting changes over time. However, employment rates in the August to October quarter of 2024 were higher than the equivalent quarter in 2023 in London, the East of England and the East Midlands. London saw the largest increase in the employment rate, at 2.5 percentage points. By contrast, employment rates in August to October 2024 were lower than they had been one year earlier in Northern Ireland, Wales, the South East of England, the West Midlands, Yorkshire and the Humber and the North East. The fall in the employment rate over this period was greatest in Yorkshire and the Humber, where it declined by 2.5 percentage points. In Scotland, the South West and the North West there was little change in the employment rate over this period.

The rate of economic inactivity in the August to October quarter of 2024 was lower in the South West, London, East of England and East Midlands than it was one year earlier. The reduction in economic inactivity was greatest in London, where it fell by 3.3 percentage points between 2023 and 2024. In Northern Ireland, the South East, the West Midlands and Yorkshire and the Humber the rate of economic inactivity rose compared with one year earlier. The increase in the rate of economic inactivity was most pronounced in Yorkshire and the Humber, which saw a rise of 2.4 percentage points. In Scotland, Wales, the North West of England and the North East, there was little change in the rate of economic inactivity compared with one year earlier. This varying picture, which is even greater at sub-regional level, shows the importance of tackling inequalities so everyone has a fair chance in life wherever they live.