London’s unemployment rate falls to a record low, while the total number of jobs in the capital reaches 6 million.

The ONS today released labour market data for the three months to January 2019. London’s labour market continued to perform well on headline measures, with the ILO unemployment rate reaching a new record low. The workforce jobs series was also updated this month, with provisional estimates for the fourth quarter of 2018. Jobs in London increased by 1.3% on the fourth quarter of the previous year, compared to 1.2% in the UK as a whole.

• In the three months to January 2019 there were 4.7 million Londoners in work, up 84,000 on the previous year. At the same time, there were 207,000 unemployed residents and almost 1.3 million economically inactive working age residents.
• London’s unemployment rate (the number of unemployed people as a percentage of the labour force) was estimated at 4.2%, 0.8 percentage points lower than a year earlier and the lowest estimate since comparable records began in 1992. The UK unemployment rate stood at 3.9%. This is the lowest rate since November 1974 to January 1975.
• Data on workforce jobs shows that in the three months to December 2018 there were 6.0 million jobs in London. This marks an increase of 29,000 (0.5%) on the quarter and 80,000 (1.3%) on the year. The growth of workforce jobs in the last 12 months was slightly below the average annual rate over the last two decades, of 1.8% (the series started in 1996).
• In terms of sectors, Accommodation and Food services (+30,000) saw the highest annual growth in jobs, followed by Transportation & Storage and Finance & Insurance (both +20,000). However, the Wholesale & Retail (-53,000) and Construction (-21,000) industries saw workforce jobs fall on the previous year.
• The DWP also recently introduced experimental ‘Alternative Claimant Count’ This provides a consistent estimate of the number of people claiming unemployment related benefits over time.
  • Under Universal Credit (UC), a broader span of claimants are required to look for work than before. To provide a measure that is consistent over time and areas, this experimental series models what the Claimant Count would have been if UC had been in place since 2013.
  • On this basis, London’s alternative claimant unemployment rate was estimated at 3.2% in November 2018, unchanged on the previous year. For the UK the alternative claimant rate was 3.0%, an increase on the previous year of 0.1 percentage points.
• Please see the charts and tables on the following pages for more detail on this data.

Note on interpreting labour market data: many of the statistics presented here (for example, the employment rate and unemployment rate) are estimates based on a survey, and as such have a margin of error- known as sampling variability. For example, a sampling variability of 0.1 and an estimated value of 2% would mean that if the survey was carried out 100 times, then in 95 of these the value would be between 1.9% and 2.1%. Changes in the headline indicators for London, and the gap between London and the UK are typically within the survey’s margin of error, meaning they are not statistically significant and may not reflect real changes / differences.

Headline labour market data – employment rate, unemployment rate, and economic inactivity rate

Note: charts show seasonally adjusted data.

London’s employment rate (i.e. the proportion of London’s residents aged 16-64 population in employment) in the three months to January 2019 was 75.4%, down 0.2 percentage points on the quarter, and up 0.7 percentage point on the year. The UK’s employment rate was 0.8 percentage points higher than London’s at 76.1%, up 0.4 percentage points on the quarter and 0.8 percentage points on the year.

In the three months to January 2019 London’s ILO unemployment rate was 4.2%, down 0.4 percentage points on the quarter and 0.8 percentage points on the year, reaching a new record low. The UK unemployment rate  stood at 3.9%, down 0.1 percentage points on the quarter and down 0.4 percentage points on the year.

In the three months to January 2019 the rate of economic inactivity in London (the proportion of 16 to 64 year olds not in work and not looking for or not able to work) was 21.3%, up 0.4 percentage points on the quarter and unchanged on the year. The UK’s rate of economic inactivity was stood at 20.7% and was down 0.3 percentage points on the quarter and 0.5 percentage points on the year.

Headline labour market data for London and the UK

*All figures are seasonally adjusted. Rates are based on working age (16 – 64 male and female), with the exception of the unemployment rate which is age 16+. We are no longer including a table with the claimant count (the number of people claiming unemployment benefits). The roll out of Universal Credit has caused problems with this statistic. In September 2017 we provided a briefing.  

Jobs charts

Year-on-year jobs growth (%), London and the UK, 1996 to 2018 Q4

Source: ONS workforce jobs

Jobs growth in London by sector, past 12 months (2017-18 Q4) and previous (2016-17 Q4)

Source: ONS workforce jobs