1. Headline indicators

Employment in September 2024 fell by 73,000 on the previous month and rose by 153,500 on the April-June 2024 quarter, to 31,766,000. The employment rate for those aged 16-64 went up to 74.8% from 74.5% in the previous quarter.

Economic inactivity for those aged 16-64 fell by 162,000 on the previous quarter to 9.25 million. The economic inactivity rate fell to 21.8% from 22.2% in the last quarter.

Unemployment (for those aged 16-64) went up by 47,000 compared with the previous quarter to 1.45 million. The unemployment rate rose slightly to 4.4% from 4.2% 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. Nominal pay rises continue to outstrip inflation

The latest data show average regular earnings grew by 4.8% in the year to September 2024, similar to 4.9% in August 2024 and down from the post-pandemic peak of 7.9% in August 2023. For public sector workers average regular earnings grew by 4.7% in the year to September 2024, while average regular earnings grew by 4.8% for private sector workers. After taking account of inflation, real regular earnings went up by 1.9% (3-month average change) in the year to September 2024, with the single month data for September showing a real-terms increase of 2.2% over the year.

The rate of inflation has generally been falling since May 2023 and fell from 3.1% in August to 2.6% in September. In the year to September 2024 core CPIH (excluding energy, food, alcohol and tobacco) rose by 4.0%, slightly less than the 4.3% increase seen in the year to August 2024. This fall in the rate of increase was driven by reductions in the price of goods and a lower rate of inflation for services. The inflation rate for goods fell from -0.9% in August to -1.4% in September 2024 and the rate of inflation for services fell from 5.9% to 5.6% over the same period.

Inflation in areas like Owner occupiers’ housing costs, Health and Communication is still high. In September the UK had the highest rate of inflation in the G7. The United States is currently experiencing an inflation rate of 2.4% while the Eurozone average is 1.7%. 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 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 8.4% since the pandemic started.

Economic inactivity has fallen slightly in the most recent quarter, with the rate standing at 21.8% for those aged 16-64 in July to September 2024 – down from 22.2% in the previous quarter. Overall, the number of those aged 16-64 who are economic inactive is 697,000 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 July to September quarter of 2024 the difference between the employment rates of people from a Bangladeshi, Chinese 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 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. Differences in response rates and sample sizes between ethnic groups may also result in volatility in some series over 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 July to September quarter of 2024, 54.4% of people with a disability were employed – an increase on the same quarter one year earlier, when the employment rate stood at 53.5%. The difference in the employment rates of people with a disability and those without a disability has narrowed over time but remains substantial. In July to September 2024 the employment rate for people with a disability was 27.5 percentage points lower than the employment rate for those without a disability (81.9%).

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 July to September 2024 quarter was 14.8%, 2.8 percentage points higher than the rate in the same quarter one year earlier (12.1%). The number of young people aged between 16 and 24 who are not in employment or full-time education currently stands at 1,211,000.

The percentage of those aged 16-17 who were not in employment or full-time education was higher in July to September 2024 compared with the same quarter one year earlier (9.3% and 8.1% 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 19.1%. 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 August to October 2024 quarter were down by 9,000 on the previous month, at 831,000, and 35,000 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 July to September 2024 quarter was 1,486,000. The quarterly headline figure has risen by 50,000 since April to June 2024. The ONS figure for claimant unemployed is 1,806,000. 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 September 2024 the number of unemployed people who were claiming unemployment-related benefits was 293,000 higher than the number unemployed on the official measure.

8. Unemployment rates fairly stable for older people, but rising for those aged 16-24

The 16-to-24-year-old unemployment rate (including students) was 14.8% of the economically active in the July to September 2024 quarter. The rate for those aged 25 to 49 was 2.9%. For those aged 50 and over it is 2.6%. Compared with the previous quarter the unemployment rate has risen by 1.4 percentage points for 16-to-24-year-olds, 0.2 percentage points for those aged 50 or more and has fallen slightly (by 0.2 percentage points) for 25-to-49-year-olds. Compared with the July to September quarter of 2023, the unemployment rate for 16-to-24-year-olds was 2.8 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 0.4 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 27,000 over the last quarter and stood at 192,000 in the July to September 2024 quarter. It also rose by 38,000 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 231,000 in the July to September 2024 quarter. The number of people aged 25 and over out of work for 12 months or more was 11,000 lower in the most recent quarter than in the previous quarter (April to June 2024). Compared with the same quarter one year earlier, adult long-term unemployment has fallen by 11,000.

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 July to September quarter of 2024 were higher than the equivalent quarter in 2023 in London, the East of England, the East Midlands and the North West. London saw the largest increase in the employment rate, at 2.8 percentage points. By contrast, employment rates in July to September 2024 were lower than they had been one year earlier in Northern Ireland, Wales, the South East of England, the West Midlands and Yorkshire and the Humber. The fall in the employment rate over this period was greatest in Wales, where it declined by 2.8 percentage points. In Scotland, the South West and the North East there was little change in the employment rate over this period.

The rate of economic inactivity in the July to September quarter of 2024 was lower in the South West, London, East of England, East Midlands and North East than it was one year earlier. The reduction in economic inactivity was greatest in London, where it fell by 3.6 percentage points between 2023 and 2024. In all other regions 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 1.9 percentage points. 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.