With the unemployment rate easing back to 5% and the number of payrolled employees rising for three months in a row (up nearly 200,000 over this period), there are some positives in the latest ONS figures. The labour market’s resilience reflects a combination of furlough and businesses having adapted to lockdowns.
Yet, one year on from the day a shellshocked Prime Minister declared the first national lockdown, the damage to the labour market is clear. Nearly 700,000 fewer people are on payrolls than this time last year. The toll among under 25s has been brutal. Despite making up just 12% of the workforce, the under 25s account for almost two-thirds of those payroll losses.
The outlook is mixed. With the furlough scheme still holding back the floodgates of further job losses, the market is braced for a further wave of redundancies when that support is eventually withdrawn. The ONS data shows that between December and February there were 601,000 vacancies across the UK, with growth having stalled recently. With unemployment standing at 1.68 million, that represents just 0.36 vacancies for each unemployed person.
But real-time data on Indeed job postings are more upbeat. Following the reopening roadmap, we’re seeing early signs of a pickup in the worst-hit sectors. In particular, the reopening of the leisure and hospitality sectors should boost the prospects of those hard-hit young workers. For all the labour market’s current weakness, we are starting to see some green shoots.