Young People and Lowest Paid Hardest Hit
Tony Wilson, Director, Institute for Employment Studies comments on the latest labour market statistics.
Tony Wilson, Director, Institute for Employment Studies comments on the latest labour market statistics. Thursday’s figures show clearly that the jobs market continued to weaken during the lockdown and is showing no signs yet of recovery. Even with the emergency measures to protect jobs and incomes, paid employment has already fallen by around a million since March and this is only going to get worse in the coming months.
Today’s data showed a welcome if small improvement in the numbers claiming unemployment-related benefits after two months of record-breaking rises. This appears to be a result of self-employed income support payments being made in May, and so lifting many new claimants back out of the claimant count.
However, the numbers of young people claiming unemployment related benefits has continued to rise and today’s data gives the clearest signs yet that younger people are being hit hard by the crisis. One in seven of the youth labour force are now claimant unemployed, double the rate for older people, and the official measure of unemployment has crept up to its highest since 2017.
Our research has also highlighted that low paid workers are bearing the brunt of this crisis – with the low paid twice as likely to have been temporarily laid off during the crisis and disproportionately likely to have lost their jobs.
Perhaps of most concern, today’s data confirms that the hiring market has collapsed – with new starts to employment running at just half of pre-crisis levels, and vacancies falling by three fifths. A combination of continued employer uncertainty and significant spare capacity within firms as workers come back from furlough has led to a stagnant hiring market and reiterate that the government will need to act fast to implement its plan for jobs. And with more job losses likely through the autumn and winter, if hiring doesn’t start to bounce back soon then we may yet need more measures to stimulate growth.