ONS Labour Market: Only 53% of Working-Age People with Disabilities are Employed

• The UK employment rate (for people aged 16 to 64 years) was estimated at 74.5% in April to June 2024, below estimates of a year ago, but increased in the latest quarter.
• Learning and Work highlights that in April to June 2024, only just over half (53.0%) of all people of working age with a disability were employed, compared with 81.6% of those without a disability
• The UK unemployment rate (for people aged 16 years and over) was estimated at 4.2% in April to June 2024, below estimates of a year ago, and decreased in the latest quarter.
• The UK economic inactivity rate (for people aged 16 to 64 years) was estimated at 22.2% in April to June 2024, above estimates of a year ago, but largely unchanged in the latest quarter.

Trends and considerations around comparisons

There were an estimated 100,000 working days lost because of labour disputes across the UK in June 2024. The majority of the strikes were in the health and social work sector.

This month’s labour market figures show that the number of vacancies is continuing to fall, although these are still 11.0% higher than in January to March 2020. The unemployment rate is slightly below that of a year ago, while there was a modest increase in both the total number of people in employment and the number of payrolled employees in the latest quarter. Our Annual growth rate comparisons dataset, which includes comparisons of HM Revenue and Customs Pay As You Earn (PAYE) Real Time Information (RTI), and Labour Force Survey (LFS) estimates, sets out the annual growth rates for these measures in recent periods and suggests a more subdued picture, with the number of employed people lower than a year ago while growth in payrolled employees has slowed over the year.

There has been a slight slowing in the annual growth in regular earnings in the three months to June 2024 to 5.4%, although this remains relatively strong. Total earnings growth has dropped sharply over the same period because of last year’s NHS one-off bonus payments.

Latest Data

• The early estimate of payrolled employees for July 2024 increased by 24,000 (0.1%) on the month and increased by 252,000 (0.8%) on the year, to 30.4 million. The July 2024 estimate should be treated as a provisional estimate and is likely to be revised when more data are received next month.
• Estimates for payrolled employees in the UK increased by 14,000 (0.0%) between May and June 2024, and rose by 227,000 (0.8%) between June 2023 and June 2024.
• Increased volatility of LFS estimates, resulting from smaller achieved sample sizes, means that estimates of quarterly change should be treated with additional caution. We recommend using them as part of our suite of labour market indicators, alongside Workforce Jobs, Claimant Count data, and PAYE RTI estimates

The UK Claimant Count for July 2024 increased on the month and on the year, to 1.801 million. Commencing in May 2024, the Department for Work and Pensions are rolling out an increase in the administrative earnings threshold for full work search conditionality. This change is likely to affect around 180,000 claimants over a period of around 6 months, increasing the Claimant Count over that time.

The estimated number of vacancies in the UK decreased in May to July 2024 by 26,000 on the quarter to 884,000. Vacancies decreased on the quarter for the 25th consecutive period but are still above pre-coronavirus (COVID-19) pandemic levels.

Annual growth in employees’ average regular earnings (excluding bonuses) in Great Britain was 5.4% in April to June 2024, and annual growth in total earnings (including bonuses) was 4.5%. This total annual growth rate is affected by comparing with a period including June 2023 when the NHS one-off bonuses were paid. 

Annual growth in real terms (adjusted for inflation using the Consumer Prices Index including owner occupiers’ housing costs (CPIH)) for regular pay was 2.4% in April to June 2024, and for total pay was 1.6%.

This bulletin includes data from business and social surveys, as well as data from administrative sources. It includes a combination of accredited official statistics and official statistics in development and, therefore, we advise the consideration of this when using.

Latest Indicators at a Glance

Sector Reaction

Work and Pensions Secretary, Liz Kendall MP, said

“This is yet more evidence of the dire inheritance we face, with millions of people denied the support they need to get work and get on at work, harming their opportunities and holding back growth. 

“This government will deliver the change the country is crying out for by making work pay, transforming skills, overhauling jobcentres and giving local areas the power they need to drive jobs and growth.”

Chancellor of the Exchequer, Rachel Reeves MP added:

“Today’s figures show there is more to do in supporting people into employment because if you can work, you should work.

“This will be part of my Budget later in the year where I will be making difficult decisions on spending, welfare and tax to fix the foundations of our economy so we can rebuild Britain and make every part of our country better off”.

Dr Helen Gray, chief economist at Learning and Work Institute, said:

“This month’s labour market figures show that the number of people of working age who were economically inactive in the April to June quarter of 2024 was 350,000 higher than in the same quarter of 2023. Compared with the period immediately prior to the pandemic (December 2019 to February 2020), 859,000 more people aged 16 to 64 were economically inactive in the most recent quarter. 1.8 million people who are economically inactive want a job.

“In April to June 2024, only just over half (53.0%) of all people of working age with a disability were employed, compared with 81.6% of those without a disability. Yet only 1-in-10 out-of-work people with a disability get help to find work each year. To achieve the government’s ambition of an 80% employment rate, it will be necessary to extend employment support to a greater proportion of those who want to work.”

Matthew Percival, CBI Future of Work & Skills Director, said:

“Economic inactivity remains stubbornly high, particularly regarding the 2.8 million long-term sick. Ill health affects lives and stunts growth so there is an indisputable case for business and Government to work together to improve the health of people in work. Employers can play a more proactive role in the health of their workforce, but the tax system discourages it.

“At the Autumn Budget, the Government can make a difference through action on employee health tax incentives.  Making Employee Assistance Programmes fully tax-free would complement the Government’s Back to Work plan by preventing people from becoming economically inactive in the first place. Today’s CBI analysis suggests that every £1 on this measure would generate £10 for the economy.”

TUC General Secretary Paul Nowak said:

“The Conservatives left the economy in disarray. And workers are still suffering the consequences with a million people on zero-hour contracts, high unemployment, falling vacancies and huge numbers of people unable to work because of long-term sickness.

“The new government has already made an important start on a new approach that can create good quality new jobs, raise living standards, and help more people into work.  

“The New Deal for Working People will give all workers the urgently needed right to a secure contract, and it will help boost incomes across the economy. And by bringing down NHS waiting lists and delivering a youth guarantee, the government can make sure more people are either earning or learning and set the UK jobs market on a stronger path.”

The Recruitment and Employment Confederation (REC) Chief Executive Neil Carberry said:

“Today’s data reflects the cooling market recruiters reported in the Spring – though there are clear positive signals in things such as the upswing in temporary work. Vacancies have now normalised towards their pre-pandemic norm and cooling pay growth justifies the Bank of England’s recent interest rate decision.

“It is very clear where the challenge lies in our jobs market. Employment rates are still well below pre-pandemic levels and economic inactivity is way too high. It is essential that the new government works with businesses to address this – and makes sure its plans for workplace regulation don’t put barriers in the way of getting jobs for those who really need them.”

Hannah Slaughter, Senior Economist at the Resolution Foundation, said:

“Workers’ pay packets continue to grow coming out of the cost-of-living crisis, but the recent strong real wage growth is running out of steam as productivity stagnates and the jobs market cools.

 “While monetary policy makers may be less worried now about pay rises fuelling inflation, they should be concerned about the lack of reliable data on the wider state of the labour market.

“Official data is likely to be under-estimating the real level of employment in the UK, which could be close to a record high. This data failure is blind-siding monetary policy makers as they weigh up what to do on interest rates.”

Petra Tagg, Director, ManpowerGroup UK, said: 

“There are some signs that the labour market is beginning to loosen marginally, with overall job openings continuing to decline and unemployment decreasing slightly on the quarter to 4.2%, having been around the four percent level for several months. Wage growth is still slowing although it remains high at 5.4% for average regular earnings and 4.5% for total earnings. In real terms, this was 2.4% and 1.6% respectively between April and June. Despite these cooling trends, vacancy levels are still above pre-pandemic levels and competition for specialist talent is fierce in almost every industry, with skills shortfalls still at an 18-year high. This is creating a situation where the hiring intent is positive, but in large part because the churn of existing roles means employers are struggling to fulfil their ambitions to grow. 

“A lack of workforce participation from those who are of working age is still constricting economic growth and more than 2.8 million people are affected by long-term sickness (out of more than nine million who are currently classed as ‘economically inactive’). Prime Minister Sir Keir Starmer’s election pledge to get more people into work is welcome, but how the ‘inactivity’ numbers change will depend on myriad factors including the Government’s workplace reforms, outcomes of the new independent investigation into the NHS, and the speed of technological progress in AI and automation. 

“With some of the greatest workplace reforms in a generation now underway, we’re advising businesses to ensure they are prepared. As an example, now is an excellent time for employers to bring their workforce planning and skills development programmes into alignment with what we currently know of Labour’s new legislative agenda. Plus, businesses should take heart from the upswing in business confidence, risk appetite and growth expectations we and others are seeing, post-election. Our motto remains: ‘Keep calm and carry on’.”