Wage growth remains strong and vacancies edge closer to pre-pandemic levels
Learn about the latest trends in the labour market.
In the period between August and October 2024, wage growth across the economy remained strong, employment and unemployment levels both increased, while vacancies and inactivity fell. This follows trends seen in previous months, and suggests while the labour market may be cooling, there is an increasingly finite labour supply that businesses can draw on to grow.
The UK employment rate (for people aged 16 to 64 years) was estimated at 74.9% in August to October 2024, marginally up on the quarter (+0.1%) but unchanged on the year. The UK unemployment rate (for people aged 16 years and over) was estimated at 4.3% in the same period, slightly up on the quarter (+0.1%) and the year (+0.3%).
The UK economic inactivity rate for people aged 16 to 64 years was estimated at 21.8% between August and October 2024, slightly down on the quarter and the year (-0.2%).
In the period August to October 2024, the estimated number of vacancies in the UK decreased by 31,000 on the quarter to 818,000. Vacancies decreased on the quarter for the 29th consecutive period and are marginally above pre-pandemic levels (817,000).
Payrolled employees in the UK increased by 24,000 (+0.1%) between September and October 2024 and rose by 140,000 (+0.5%) between October 2023 and October 2024. The early estimate of payrolled employees for November 2024 decreased by 35,000 (-0.1%) on the month but increased by 76,000 (+0.3%) on the year, to 30.4 million. The November 2024 estimate should be treated as a provisional estimate and is likely to be revised when more data is received next month.
Annual growth in employees' average regular earnings (excluding bonuses) in Great Britain was 5.2% in August to October 2024, and annual growth in total earnings (including bonuses) was also 5.2%. Annual growth in real terms (adjusted for inflation using the Consumer Prices Index including owner occupiers' housing costs (CPIH)) for regular pay and total pay were both 2.2% across the same period.
While the reliability of the data continues to be questioned due to sampling issues with the Labour Force Survey (LFS), alternative calculations agree with the main messages that businesses can no longer rely on simply bringing more people into the labour market to drive productivity and grow. It is therefore critical that the Government works with employers to unlock capital so businesses can make productivity-enhancing investments in training, automation and well-being services for employees.
