Labour market update for London – June 2017
Record number of jobs in London
London’s employment rate (i.e. the proportion of London’s resident working age population in employment) in the three months to April 2017 fell by 0.2 percentage points on the previous quarter to 73.3 per cent. This is the fourth successive month London’s employment rate has fallen. The UK has had the opposite trend, with the employment rate increasing in recent months and in the latest data. The UK employment rate stands at 74.8 per cent. Despite the recent trend London’s employment rate is only down slightly on the year (by 0.1 percentage points).
London’s ILO unemployment rate in the three months to April 2017 was 6.0 per cent. This is up 0.3 percentage points on the previous quarter and up 0.1 percentage points on the previous year. In recent months the London unemployment rate has increased while the UK unemployment rate has fallen; the latter was 4.6 per cent in the latest data. London currently has the highest unemployment rate of any UK region. This is partially offset by a comparatively low rate of economic inactivity (22.0 per cent in Feb-Apr 2017, only slightly above the UK’s 21.5 per cent).
Workforce jobs numbers were updated this month. The number of jobs located in London in Q1 2017 (i.e. whether or not they are taken by residents of London) reached 5.75 million, a record high. This is an increase of 40,000 jobs on the previous quarter and 64,000 on the previous year. This amounted to 0.7 per cent jobs growth on the previous quarter in both London and UK. In London, largest year-on-year jobs growth came from Professional Services (43,000 increase) and Health and Social Work (23,000 increase) in line with previous trends. On the other hand, jobs in Education (-23,000 jobs), Real Estate (-20,000 jobs) and Finance and Insurance (-16,000 jobs) all had declines, and contrary to previous trends. On a quarterly basis there was a large increase in Construction jobs (28,000 increase) and an equally large fall in jobs in Arts, Entertainment and Recreation (-29,000). Finally, of the 40,000 net increase in London jobs on the previous quarter, 43% were self-employed jobs.
The ONS recently published data on ‘workless’ households, which is a household where at least one person is aged 16 to 64 but where no one is employed. There were 507,000 such households in London between January and March 2017, 8.5 per cent of all households. London’s workless rate is lower than of the UK (10.4 per cent). There was little year-on-year change in London (slightly up from 8.3 per cent in Jan-Mar 2016) but the workless rate is lower than it has been in recent years (for example, the highest rate in the last ten years was 14.4 per cent in Oct-Dec 2011, when London’s workless rate was higher than the UK rate).
*All figures are seasonally adjusted. Rates are based on working age (16 – 64 male and female), with the exception of unemployment rate which is age 16 and above.
** ONS have ceased reporting on the claimant count as an official statistic as the roll-out of Universal Credit replaces Jobseekers’ Allowance. This is because of differences in definitional and administrative processes between the two benefits, and affects seasonality. The change in the administrative process is also increasing numbers in the claimant count. Differences in the phasing of UC roll out is an explanation of relative differences in claimant count growth between London and UK. We will continue to include the claimant count figure in these updates have removed the year-on-year comparisons. This will be kept under review.
Employment rate and unemployment rate charts