The number of people unemployed in the UK has fallen by 0.1 per cent compared to data from the previous quarter. 

Data from the Office for National Statistics (ONS) has shown that, between December 2020 to February 2021, the unemployment rate in the UK stood at 4.9 per cent.

During these three months, despite the third national lockdown being instated, the unemployment rate dropped by 0.1 per cent although it remained 0.9 per cent higher than a year earlier.

This accounted for 1.67 million people being unemployed although this was down 50,000 on the quarter which was the first quarterly decrease since 2019, signalling an improvement in the labour market.

Despite this, the recovery seen in vacancies has stalled significantly. Initially picking up pace in September with a rise of 165,000, there was only a rise of 17,000 vacancies over the last three months. The most recent data shows 607,000 vacancies in total between January – March 2021 which was almost a quarter (23 per cent) lower than the number of job vacancies present a year before.

The analysis also found that employees working within the hospitality sector, workers aged under 25 and staff living in London saw the largest fall in payrolled employee numbers. Comparing March 2021 to the month prior, 56,000 fewer people were in payrolled employment.

The total number of weekly hours worked also saw a fall when contrasted against the previous quarter. During this current time, the total number of weekly hours worked was 959.9 million. This was down 92.3 million hours on the same period the previous year and down 20.1 million hours compared with the previous quarter.

The analysis also tracked a growth in average total pay, placing this increase at 2.5 per cent for total and regular pay after compositional effects (including a decrease in the number of workers within low-paid jobs) were taken into account.

Overall, the analysis deemed the labour market to be “broadly stable” in recent months.

Neil Carberry, Chief Executive of the Recruitment and Employment Confederation (REC), points to the “continued resilience” in the labour market:

These figures show continued resilience in the labour market despite the winter lockdown. The unemployment rate was lower than the previous quarter – reflecting an upturn in hiring, as REC surveys and today’s vacancies numbers suggest.

We now need to look to how we support this recovery. A reform of the apprenticeship levy to support retraining for older workers and opportunity for younger workers – who have been particularly hard hit – is now essential.

However, Matt Weston, Managing Director of Robert Half UK, highlighted the role of the Coronavirus Job Retention Scheme (CJRS) in preventing rising unemployment levels:

The latest labour market figures only partially reflect the scale of the pandemic’s impact on employment levels, and the outlook for employment as the furlough scheme remains in place across the UK to support jobs. It is clear the UK’s unemployment rate would be far higher should the job retention scheme come to an end overnight.

Mr. Weston also focussed on the evolving skill-set that candidates would need to demonstrate as hybrid working begins:

The scale of the economic challenge facing us should not be understated, but from a skills evolution and demand perspective, COVID-19 can be seen as the ultimate disruptor and accelerator. Employers are increasingly requiring applicants to demonstrate expanded and more diverse skill sets in response to the evolving COVID-19 pandemic. Hard, technical proficiencies must be accompanied by evidence of soft, more people-focused expertise, to form new ‘hybrid’ skill blends.

TUC General Secretary, Frances O’Grady, also emphasised the need to support people under the age of 25:

Young workers are bearing the brunt of this pandemic. Many of them working in badly-hit industries like retail, hospitality and the arts have lost their jobs and are at risk of long-term unemployment.

Ministers must reboot the kickstart scheme and create good new jobs in green transport, infrastructure and social care. And boost universal credit so that people who have lost their jobs are not plunged into poverty.


*These statistics were taken from the ONS analysis – Labour Market Overview UK: April 2021 which can be found here.