UK graduate labour market update: 20 April

In this week's summary of the latest labour market data, analysis and reports by Charlie Ball: the ONS on homeworking, Handshake UK's research on the impact of online recruitment, and more insights into the future of work

The Office for National Statistics (ONS) released their monthly labour market overview, to the end of March, on 20 April:

• 56,000 fewer people were in payrolled employment in March 2021 when compared with February 2021.
• The UK employment rate was estimated at 75.1%, 1.4 percentage points lower than a year earlier and 0.1 percentage points lower than the previous quarter.
• The UK unemployment rate was estimated at 4.9%, 0.9 percentage points higher than a year earlier but 0.1 percentage points lower than the previous quarter.
• The estimated UK unemployment rate for men was 5.2%; this is 1.0 percentage points higher than a year earlier but 0.2 percentage points lower than the previous quarter.
• The estimated UK unemployment rate for women was 4.6%; this is 1.0 percentage points higher than a year earlier but largely unchanged compared with the previous quarter.
• The UK economic inactivity rate was estimated at 20.9%, 0.7 percentage points higher than a year earlier and 0.2 percentage points higher than the previous quarter.
• The total number of weekly hours worked was 959.9 million, down 92.3 million hours on the same period the previous year and down 20.1 million hours compared with the previous quarter.
• There were an estimated 607,000 job vacancies in January to March 2021, which is a 22.7% fall compared with a year ago.

Scottish data is available from the Scottish government:

• Over the quarter, the unemployment rate stayed the same, the employment rate increased and economic inactivity rate decreased.
• Scotland's unemployment rate (16+) stayed the same over the quarter and increased over the year (0.6 percentage points) to 4.4%.  Scotland's unemployment rate was below the UK rate of 4.9%.
• The proportion of people aged 16 to 64 in work (increased over the quarter (0.2 percentage points) but decreased over the year (0.7 percentage points) to 74.6%. 
• Scotland's employment rate was below the UK rate of 75.1%.
• The economic inactivity rate decreased over the quarter (0.2 percentage points) but increased over the year (0.2 percentage points) to 21.9%.  Scotland's inactivity rate is above the UK rate of 20.9%.
• Early estimates for March 2021 indicate that there were 2.3 million payrolled employees in Scotland, a decrease of 3.1% (73,000) compared to the same month the year before.  The number of payrolled employees in the UK decreased by 2.8% over the same period.

Data for Wales is available too (though the Senedd have not yet produced their usual excellent overview):

• The employment rate in Wales was 73.2%. This is 0.8 percentage points up on the quarter and 0.8 percentage points down on the year.
• The unemployment rate in Wales was 4.8%, the highest rate since October to December 2017. This is 0.1 percentage points up on the quarter and 1.1 percentage points up on the year.
• The economic inactivity rate in Wales was 23.0%. This is 1.0 percentage points down on the quarter and 0.1 percentage points down on the year.
• Early estimates for March 2021 indicate that the number of paid employees in Wales was 1.23 million. This was a decrease of 29,000 (2.3%) on February 2020, but a slight increase of 6,000 (0.5%) compared with the lowest point in November 2020.

Meanwhile, Northern Irish data is here:

• The latest Labour Force Survey (LFS) estimates relate to December to February 2021 and indicate that, over the quarter, the employment rate decreased, and the unemployment and economic inactivity rates increased.
• The number of people on the NI claimant count decreased marginally over the month to 58,100 in March 2021. 
• From 1 April 2020 to 31 March 2021, 10,090 redundancies were proposed, more than double the previous 12 months. 170 redundancies were proposed in the three-month period January to March 2021. The department (NISRA) was notified of 250 confirmed redundancies in March 2021, taking the annual total to 5,780.
• The number of employees receiving pay through HMRC PAYE in NI in February 2021 was 744,300, an increase of 0.2% over the month and a decrease of 1.2% over the year. The flash estimate for March 2021 shows a marginal decrease of less than 0.1% on February’s figure to 744,100.
• The flash estimate of earnings for March 2021 shows a 0.7% increase in earnings from February's figure to £1,792.
• The NI unemployment rate (16+) increased over the quarter (0.5 percentage points) and the year (1.2 percentage points) to 3.7% in December to February 2021. The NI unemployment rate was below the UK rate (4.9%).
• The proportion of people aged 16 to 64 in work decreased over the quarter (1.6pps) and the year (3.5 percentage points) to 69.0%.The latest employment rate recorded for the whole of the UK was 75.1%
• The NI economic inactivity rate increased over the quarter (1.3 percentage points) and the year (2.7 percentage points) to 28.3%. The NI economic inactivity rate remained above the UK rate (20.9%).

Additionally, data for the regions can be found here:

• Since March 2020, in terms of percentage change on same month in previous year, all regions' growth rates for payrolled employees followed a similar pattern: rapidly declining and becoming negative in April and continuing a slower downward trend.
• The magnitude of changes varies: comparing March 2021 with the same period of the previous year, decreases in payrolled employees range from 1.3% in Northern Ireland to 5.4% in London.
• For the three months ending February 2021, the highest employment rate estimate in the UK was in the South East (78.4%) and the lowest was in Northern Ireland (69.0%). All regions saw a decrease in the employment rate compared with the same period last year, with Northern Ireland seeing the largest, with a decrease of 3.5 percentage points and Yorkshire and The Humber with the smallest decrease of 0.1 percentage points.
• For the three months ending February 2021, the highest unemployment rate estimate in the UK was in London (7.2%) and the lowest was in the South East (3.4%). All regions saw an increase in the unemployment rate compared with the same period last year, with London seeing the largest, with an increase of 2.7 percentage points and the North East with the smallest increase of 0.1 percentage points.
• For the three months ending February 2021, the highest economic inactivity rate estimate in the UK was in Northern Ireland (28.3%) and the lowest was in the South East (18.8%). Most regions saw an increase in the economic inactivity rate compared with the same period last year, except for Wales which saw a small decrease of 0.1 percentage points, and Yorkshire and The Humber and London, which both remained unchanged.
• Between September and December 2020, workforce jobs decreased in most regions of the UK, with the largest decrease of 60,000 seen in London; the largest increase was in the West Midlands, with an increase of 26,000; London has the highest proportion of service-based jobs, at 92.2%, while for the production sector, the highest proportion of jobs is in the East Midlands, at 12.7%.
• Average weekly hours worked, for the 12 months ending December 2020, varied between London, with 30.3 million hours worked and the North East, with 27.2 million hours worked. All regions saw a decrease in the average weekly hours worked, compared with the same period last year, with the North West and West Midlands both seeing the largest decreases of 3.9 hours per week; for total weekly hours worked, the South East saw the largest decrease compared with the same period last year, down 17.5 million hours per week.

The latest round of the ONS fast response experimental statistics on the impact of COVID were released on the 15th April.

• 17% of businesses' workforce were on furlough leave at the end of March 2021 equating to approximately 5.7 million people.
• 28% of the workforce worked exclusively from home.
• On 9 April 2021, total online job adverts reached 100% of their February 2020 average level, with law and catering seeing particular rises.
• In the week to 10 April 2021, overall retail footfall in the UK was at 44% of its level in the equivalent week of 2019, a decrease of 7 percentage points from the previous week.

Also from the ONS this week, Coronavirus and the Impact on UK households and businesses: 2020:

• National income contracted by 15.0% in Quarter 2, but there was only a 3.3% fall in household's gross disposable income as spending dropped sharply.
• The share of income saved by UK households went up from 6.5% in 2019 to 15.8% in 2020. Rises of similar magnitudes were seen across the G7. High and middle-income households were more likely to have seen a rise in savings, whereas low-income, unemployed and furloughed respondents were more likely to have seen a decrease. 42% of high-income employed households saved more during the pandemic, compared with 22% of low-income employed households.
• Between April and October 2020, 43.8% of the economically active in the bottom income quintile reported reduced income, higher than the 30.4% of those in the top income quintile. Other groups who were more likely to report reduced income because of the coronavirus pandemic were working parents, and people aged under 30 years.
• Eurostat finds similar distributional effects on income for the EU, where the decrease in employment income lost is higher for the low-income group. The income loss is three to six times higher for this group than their peers in the high-income group in half of the EU member states.

And also from the ONS, this piece on homeworking:

• Of the employed population, 35.9% did some work at home in 2020, an increase of 9.4 percentage points compared with 2019. This also includes a change in the type of people who worked from home in 2020.
• The average gross weekly pay of workers who had recently worked from home was about 20% higher in 2020 than those who never worked from home in their main job, when controlling for other factors - this continues a long running trend.
• People who mainly worked from home were less than half as likely to be promoted than all other workers between 2012 and 2017, when controlling for other factors.
• People who mainly worked from home were around 38% less likely on average to have received a bonus compared with those who never worked from home between 2013 and 2020, when controlling for other factors.
• People who completed any work from home did 6.0 hours of unpaid overtime on average per week in 2020, compared with 3.6 hours for those that never work from home.
• Homeworkers were more likely to work in the evenings compared with those who worked away from home in September 2020.
• The sickness absence rate for workers doing any work from home was 0.9% on average in 2020, compared with 2.2% for those who never worked from home in their main job.

The ONS have also released an experimental framework which significantly extends the Standard Occupational Classification (SOC) used to code employment data (I was part of the advisory group).

REC, the Recruitment and Employment Confederation, have released their Jobs Recovery Tracker in partnership with EMSI:

• 140,000 new job adverts posted last week, giving a total of 1.37 million active job adverts in the UK.
• 181,000 new postings in the previous week, the highest since the onset of the pandemic
• The three best weeks for new postings since the start of the pandemic have come since 8 March, suggesting increase in hiring as restrictions begin to ease.
• Continued growth for roles in hospitality, as well as rise in adverts for photographers, electrical technicians and health & safety officers.

The Resolution Foundation have produced a report on COVID and youth unemployment, Uneven Steps:

• Young people have been more likely than their middle-aged counterparts to have lost working hours, experienced lower pay, been put on furlough or have lost their job.
• By January 2021, 41% of 18-24-year-olds who had been employed the previous February were no longer working, were furloughed or were being paid at least 10% less than they had been before the COVID-19 crisis; as were 30% of workers aged 55 and older. This was the case among a significantly lower share of 25-54-year-olds (22%).
• Before the onset of COVID-19 (Q2-Q4 2019), 25% of economically active Black 16 to 24-year-olds were unemployed, compared to 10% of their White counterparts. By Q2-Q4 2020, the unemployment rate rose to 34% (a nine percentage point increase) among Black young people and to 13% (a two point rise) among White young people.
• Between Q2-Q4 2019 and Q2-Q4 2020 unemployment among young male graduates rose more than 5 points, to 17.5% - meaning that young graduate men had a higher unemployment rate than both their female counterparts (10.2%) and non-graduate men (15.9%).
• In the second half of 2020, the unemployment rate among young White graduates (12.8%) was lower than that of young Asian graduates (15.9%) and well under half that of young Black graduates (33.7%).

Handshake UK have released an analysis of the effects of online recruitment on the talent pools employers are drawing on, which they've called Netpotism.

Research for this was conducted by Savanta ComRes between Friday 5 March and Monday 15 March 2021,  among 640 current students and 334 recent graduates in the UK, and 502 HR decision makers at UK businesses.

• 65% of businesses became more reliant on careers and jobs sites during the pandemic.
• 20% are less reliant on university careers services.
• 33% are less reliant on careers fairs.
• 22% of students don't have the technology required to access careers services since they have moved online.
• 91% of students have experienced issues with online interviews.
• The most common problems encountered during virtual interviews are a poor internet connection disrupting a video interview (34%), being worried about somebody else in the household walking in (28%) and poor equipment like microphone or laptop causing issues (26%) - all of which are problems that tend to disproportionately affect applicants who are less well off.
• 63% of employers said that they used online professional networks such as LinkedIn more due to restrictions around in-person recruitment, while over half said they used word of mouth recommendation more. A fifth of HR decision makers said they prefer to hire graduate and student candidates they already know as they're less of a risk in the current environment. And 33% of students believe that job applications and interviews are biased towards people who have existing connections.
• 15% of students feel excluded from the jobs market due to their background and 26% have found that entry-level jobs have asked for an unrealistic amount of experience.
• 58% of businesses find it harder to connect with early career candidates since the start of the pandemic.
• 66% of businesses say they’ll conduct more of the recruitment process online.

There is quite a bit this week on the future of work. First, Randstad, with the results of a survey of over 27,000 workers in 34 countries:

• 78% of UK workers want to go back to the workplace at least partially if not full-time.
• 56% of respondents now enjoy a hybrid working environment where they are in charge of choosing their workplace.
• 72% declare they will not feel safe in the workplace until others around them are vaccinated.
• 87% would be willing to get vaccinated if it's required for their job.
• 25% of surveyed employees fear unemployment because they are on temporary contracts.
• 77% are still satisfied with their job.

And this from Canada Life, surveying 592 UK adults that are full time workers who now work from home because of the pandemic.

• 34% of workers who have tested positive for COVID-19 plan on returning to the office. This compares to 69% of those who haven't suffered from the virus.
• 70% of those who plan on returning to the office are happy to adapt their working practices.
• Home workers would like their employers to adopt the following measures to benefit their mental health: mental wellness days (54%), diarised screen breaks (48%), daily mental health check ins (44%), better access to mental health services (42%), and flexible working hours (40%).

Indeed continue their work on vacancies data, this time to 9 April:

• Job postings were 16.4% below the February 1 2020, pre-pandemic baseline, seasonally adjusted, as of April 9 2021. That was little-changed from -16.0% a week earlier. Since the government's reopening roadmap was announced on February 22, there has been a 20.4 percentage point improvement in job postings relative to the pre-pandemic baseline.
• The biggest gain has been in the sports category (+48.7 percentage points), followed by therapy (+45.8 percentage points) and loading & stocking (+43.0 percentage points).
• The second stage of England's reopening on 12 April allowed personal care establishments and outdoor hospitality to resume. The beauty & wellness (+42.6 percentage points) and food preparation & service (+38.2 percentage points) categories have seen among the strongest gains in job postings since February 22. 
• Social sciences (+42 ppts) and chemical engineering (+35 ppts) have also seen healthy gains.

And finally as promised, a feature from Optometry Today on the challenges optometry students have faced during the pandemic, with some comment from me.

Written by

Charlie Ball

Head of higher education intelligence

Prospects