The strength in the London and UK labour markets continues

 The ONS today released labour market data for the three months to September 2019. The latest figures show that London’s labour market remained reasonably stable in the three months to September. However, in the year to April 2019, median weekly pay growth was relatively strong for workers in the capital. Despite this, full-time employee earnings remain below pre-crisis levels at both the UK level and (especially) in London.

• In the three months to September 2019 there were 4.7 million Londoners in work, down by 26,000 on the previous year. Meanwhile, there were 222,000 London residents who were unemployed and 1.3 million working age residents who were economically inactive.

• London’s 16-64 employment rate was 74.6%, unchanged on the quarter but down by 0.6 percentage points on the year. For the UK as a whole the employment rate stood at 76.0%, virtually unchanged on the quarter but up by 0.5 percentage points on the year.

• London’s unemployment rate (the number of unemployed people as a percentage of the labour force) was5%, which was unchanged on the year. The UK unemployment rate was 3.8%, down 0.2 percentage points on the year.

• The latest earnings data for Great Britain shows that estimated average annual growth in weekly earnings for employees was 3.6% for both total pay (including bonuses) and regular pay. After adjusting for inflation, total pay has grown by 1.8% and regular pay by 1.7%. However, the rate of increase in both total and real pay has slowed in recent months (since June 2019).

• In October the ONS also released new data from its Annual Survey of Hours and Earnings – the main measure of regional employee earnings. According to this data:
  • Median gross weekly earnings for full-time employees working in London rose to £736 in April 2019, up 3.3% from 2018. This was above the growth rate for the UK as a whole – up 2.9% to reach £585 per week in 2019 – and the highest rate of annual growth in London since 2008.
  • Despite this upturn, total pay growth for full-time workers in London has still been relatively slow over the last decade. After inflation, gross weekly earnings for full-time employees in London were still 4.5% below 2008 levels in 2019, compared to 2.9% lower for the UK as a whole.

• Please see the charts and tables on the following pages for more detail on headline labour market 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 September 2019 was 74.6%, unchanged on the quarter but down 0.6 percentage points on the year. The UK’s employment rate was 1.4 percentage points higher than London’s at 76.0%, virtually unchanged on the quarter and up 0.5 percentage points on the year.

In the three months to September 2019 London’s ILO unemployment rate was 4.5%, unchanged on the quarter and on the previous year. The UK’s unemployment rate was 0.7 percentage points lower than London’s, at 3.8%, virtually unchanged on the quarter and down 0.2 percentage points on the year.

In the three months to September 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 21.8%, virtually unchanged on the previous quarter but up 0.7 percentage points on the year. The UK’s rate of economic inactivity stood at 1.0 percentage point lower than London’s at 20.8%, virtually unchanged on the previous quarter, but down 0.3 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, 1997 to 2019 Q2

Source: ONS workforce jobs

Jobs growth in London by sector, last 12 months (2018-19 Q2) and previous (2017-18 Q2)

Source: ONS workforce jobs