News Article

BUSINESS NEWS UK-Temporary jobs show improvement, unemployment rate holds steady

Posted 22nd June 2020 • Written by •

The number of temporary employees in the UK increased by 2.1% on a seasonally adjusted basis to a total of approximately 1.51 million for the three-month period from February 2020 through April 2020 when compared to the same period a year ago, according to the Office for National Statistics.

The UK announced its lockdown on 23 March 2020 with April being the first full month of restrictions.

When compared to the previous three-month period ended March 2020, the number of temporary employees was up by 1.0%.

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 5.4%, steady when compared to a year ago.

Of the 1.51 million temporary employees during the period ended April 2020, approximately 411,370 were temporary because they could not find a permanent job; 420,810 did not want a permanent job; 113,941 had a contract with a period of training; and 570,991 cited other reasons.

Meanwhile, of the 1.50 million temporary employees during the period, 701,990 were men while 815,120 were women.

ONS also published labour market figures for the three-months ended April 2020. It added that the labour market data was collected from various sources, each covering different reference periods or count dates and are therefore impacted differently by the coronavirus, social distancing and lockdown measures.

The UK employment rate in the three months to April 2020 was estimated at 76.4%, 0.3% higher than a year earlier but 0.1% down on the previous quarter. The highest employment rate estimate in the UK was in the South East (79.5%) and the lowest was in Northern Ireland (71.6%).

The UK unemployment rate for the three months to April 2020 was estimated at 3.9%, 0.1% higher than a year earlier but largely unchanged on the previous quarter. The highest unemployment rate estimate in the UK was in the North East (5.2%) and the lowest was in Northern Ireland (2.3%); a joint record low unemployment rate.

The total number of weekly hours worked in the three months to April 2020 was 959.9 million, down a record 94.2 million (8.9%) hours on the previous year.

The estimated economic inactivity rate was 20.5%; this is down by 0.3% on the year but up 0.1% on the quarter.

There were an estimated 476,000 vacancies in the UK in March to May 2020; this is 342,000 fewer than the previous quarter and 365,000 fewer than a year earlier; experimental single-month estimates indicate a decrease of approximately 60% of vacancies for May 2020 compared with March 2020.

For the three months to April 2020 total pay (nominal) annual growth rate was 1.0%

regular pay (nominal) annual growth rate was 1.7%. Meanwhile, total pay (real) annual growth rate was -0.4% regular pay (real) annual growth rate was 0.4%.

The ONS also published data on claimant count which seeks to measure the number of people claiming benefit principally for the reason of being unemployed. The Claimant Count increased in May 2020 to 2.8 million. This represents a monthly increase of 23.3% and an increase of 125.9%, or 1.6 million, since March 2020.

Neil Carberry, CEO of the Recruitment and Employment Confederation said, “The headline figures may not show it, but a lot has changed since April, with the Claimant count rising to 2.8 million, the unemployment rate is likely to be much higher than 3.9% now. But with the lockdown being eased and the economy opening up, hiring should grow.”

“The scale of the growth in unemployment through the rest of the year will depend on consumer confidence and how employers react to the winding down of the furlough scheme. The good news is that the number of job adverts active in the UK has been slowly increasing, with more new job ads being posted every week. Helping jobseekers find new work quickly by matching them with available  roles will help kick-start the economy. The recruitment industry is ready to help the government get people into work and keep unemployment down as much as possible,” Carberry said.

ONS Deputy National Statistician for Economic Statistics Jonathan Athow said, “The slowdown in the economy is now visibly hitting the labour market, especially in terms of hours worked.

“Early indicators for May show that the number of employees on payrolls were down over 600,000 compared with March. The Claimant Count was up again, though not all of these people are necessarily unemployed,” Athow said.

David Morel, CEO, Tiger Recruitment, said, “With the furlough scheme due to be phased out in the coming months and many sectors already having reported large-scale redundancies in the UK, it seems likely that more redundancies are on their way – particularly temp/contract staff who are currently on furlough.”

“In May, we saw a 1.3% increase in new permanent jobs briefed to us versus in April and a 1.1% increase in new temp jobs coming onto our books as employers become more confident about making virtual hires. We expect virtual recruitment to continue an upward trend as employers become used to the processes of remote onboarding and having their teams working remotely,” Morel said. “We’ve also seen an uplift in temp-to-perm bookings as employers seek more flexibility while they gauge market performance – this trend is likely to continue as businesses feel their way through the new normal.”

“As lockdown measures ease, market performance will be critical to informing businesses’ decisions about bringing their staff back from furlough. At the end of June, we should start to see a true reflection of what employers plan to do. And, while our own data shows only marginal gains, it gives some confidence of a jobs market that is very slowly starting to move in the right direction,” Morel said.

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