Labour Market Statistics November 2020: Weak figures driven by continued fall in hiring and spare capacity – more measures needed to support jobs recovery
10 Nov 2020
Commenting on today’s figures, IES Director Tony Wilson said:
'Today’s figures show that the labour market continued to weaken through the autumn, weighed down by the ongoing fallout from the first lockdown. Firms have brought back around four million people from furlough, but made redundant just over 300 thousand. Redundancies are now higher than they were at the peak of the last recession, and rising at their fastest ever rate. We anticipate that they will peak at around 450 thousand a quarter by the end of the year. Of most concern today however are new figures showing that hiring continued to fall through the summer, and was lower even than it was during lockdown itself – with 1.4 million people starting a new job, compared with 1.5 million during lockdown (and 1.7 million before the crisis). This will reflect both the huge spare capacity in firms as they dealt with furlough and the crisis, but also continued uncertainty about the future including as a result of Brexit. This in turn is feeding through into particularly acute impacts on youth employment, which is down by more than a quarter of a million to its lowest ever level. In all, more than half of the total fall in employment is explained by fewer young people in work.
'Looking ahead, the second lockdown means that these figures are likely to deteriorate further through the winter, and this will be added to by uncertainty around Brexit. With the Spending Review just a few weeks away, the Chancellor needs to look at measures to get hiring going again and quickly – in particular by raising the National Insurance threshold so as to reduce labour taxes for firms, and by boosting departmental budgets so that public sector employment can pick up more of the slack from the private sector.'
Full briefing note available here