News Article

BUSINESS NEWS - UK - Number of temporary employees rises 10%, jobless rate improves while vacancies soar past 1 million

Posted 17th September 2021 • Written by •

The number of temporary employees in the UK increased by 10.1% on a seasonally adjusted basis to a total of approximately 1.63 million for the three-month period from May 2021 through July 2021 when compared to the same period a year ago, according to the Office for National Statistics.

When compared to the previous three-month period ended June 2021, the number of temporary employees increased by 1.3%.

Temporary workers are self-identified when surveyed by the ONS, and they include those who are on fixed-period contracts, temporary agency workers, casual workers, seasonal workers and others in temporary work.

The number of temporary employees as a percentage of total employment was 5.9%, up from 5.4% when compared to a year ago.

Of the 1.63 million temporary employees during the period ended July 2021, approximately 526,123 were temporary because they could not find a permanent job; 392,532 did not want a permanent job; 119,804 had a contract with a period of training; and 598,031 cited other reasons.

Of the 1.63 million temporary employees during the period, approximately 743,875 were men while 892,615 were women.

The ONS also published further labour market figures for the period from May 2021 to July 2021 which showed the UK employment rate was estimated at 75.2%, 1.3% lower than before the Covid-19 pandemic (December 2019 to February 2020), but 0.5% higher than the previous quarter (February to April 2021).

For the three months ending July 2021, the highest employment rate estimate in the UK was in the East of England (78.7%) and the lowest was in Northern Ireland (71.2%). The East of England has had an increase of 1.1%, which is the largest increase compared with the same period last year; both the East of England and Wales now have employment rates above pre-pandemic levels (December to February 2020).

The UK unemployment rate was estimated at 4.6%, 0.6% higher than before the pandemic, but 0.3% lower than the previous quarter. For the three months ending July 2021, the highest unemployment rate estimate in the UK was in London (6.0%) and the lowest was in the South West (3.3%); Wales and Northern Ireland saw the largest increases compared with the previous year, both at 1.0%.

The UK economic inactivity rate was estimated at 21.1%, 0.9% higher than before the pandemic, but 0.3% lower than the previous quarter. For the three months ending July 2021, the highest economic inactivity rate estimate in the UK was in Northern Ireland (25.7%) and the lowest was in the East of England (18.3%); Wales saw the largest decrease in the economic inactivity rate compared with last year, at 1.7%, with the rate of 22.0% being the lowest since April to June 2019.

As reported in SIA’s news yesterday, the number of payroll employees showed another monthly increase, up 241,000 to 29.1 million in August 2021, returning to pre-coronavirus (Covid-19) pandemic (February 2020) levels.

The number of job vacancies in June to August 2021 was 1,034,000, which is the first time vacancies have risen over 1 million since records began, and is now 249,000 above its pre-pandemic January to March 2020 level. Vacancies grew on the quarter in June to August 2021 by 269,300 (35.2%), with all industry sectors increasing their number of vacancies and the majority reaching record levels; the largest increase was seen in accommodation and food service activities, which rose by 57,600 (75.4%).

Growth in average total pay (including bonuses) was 8.3% and regular pay (excluding bonuses) was 6.8% among employees for the three months May to July 2021.

ONS deputy national statistician for economic statistics Jonathan Athow said, “Early estimates from payroll data suggest that in August the total number of employees is around the same level as before the pandemic, though our surveys show well over a million are still on furlough.”

“However, this recovery isn’t even: in hard-hit areas such as London and sectors such as hospitality and arts and leisure the numbers of workers remain well down on pre-pandemic levels,” Athow said. “The overall employment rate continues to recover, particularly among groups such as young workers who were hard hit at the outset of the pandemic, while unemployment has fallen. Vacancies reached a new record high. Not surprisingly, this is driven above all by hospitality, the sector with the highest proportion of employers reporting their job openings are hard to fill.”

Tania Bowers, Legal Counsel and Head of Public Policy at the Association of Professional Staffing Companies (APSCo), said, “The increasing dearth of talent that businesses across the country are reporting is a real concern to the recruitment sector. While the government has pledged to support skills development in the UK on a longer-term basis, there is a need for more immediate action.  At APSCo we are continuing our calls to the government to provide a visa entry route into the UK that both allows and encourages high value independent professionals to work in the country on a project-basis. And while the delayed return to in person Right to Work checks is a welcome move, a permanent, longer-term solution is needed to create a regulatory environment that is fit for purpose in today’s modern world.”

“We expect to see recruitment activity continue on its upward trajectory in the immediate future, however, with the furlough scheme ending this month, it will be interesting to see how this impacts the ONS labour statistics for the remaining quarter of 2021,” Bowers added.

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