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Employment rate at record high

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Experts suggest self-employment could be behind the sharp rise

The employment rate between October and December 2015 was 74.1%, the highest since comparable records began in 1971, according to figures released by the Office for National Statistics (ONS).

There were 31.42 million people in work, 205,000 more than for July to September 2015, and 521,000 more than a year earlier. The unemployment rate was 5.1%, lower than a year earlier (5.7%). This comprised of 924,000 unemployed men and 766,000 unemployed women.

Gerwyn Davies, labour market adviser at the CIPD, said the figures confirm that employment is continuing to make a full recovery. “A sharp quarterly rise of more than 200,000 in the number of people in work, combined with another fall in joblessness against the backdrop of a slowing economy is impressive,” he said.

“However, half of the employment increase comes from the self-employed, while the monthly figures suggest that growth may be slowing. The supply of EU migrants into the UK labour market is also starting to plateau, so employers will need to think carefully about how they are going to fill skills gaps in the coming months and this must start with greater investment in workforce skills.”

Kirstie Donnelly, managing director for City & Guilds, said the record employment rates are a “cause for celebration” but not for complacency. “We can’t afford to lose sight of the fact that youth unemployment remains stubbornly high, representing hundreds of thousands of young people locked out of a path to the future,” she said.

“At the core of this is our failure to ensure young people have the employability skills and workplace understanding they need to get on. We recently surveyed 14- to 19-year-olds, and found that almost 70% planned to go to university despite only 30% of available jobs forecast to be graduate roles. We must provide young people with an accurate picture of the labour market while they are still at school considering their options.”

John Salt, group sales director for Totaljobs, said the lower unemployment rate is encouraging but employers need to recognise the importance of matching suitable candidates to positions based on their experience and aspirations.

“In Totaljobs’ Employers Insight Report, published earlier this month, 68% of 100 businesses surveyed said they felt the job market is more candidate-led than in the last five years,” he said. “This is reflected in jobseekers being more selective about their next move. Of the 4,000 jobseekers surveyed for the report 65% said it has been more difficult to get a job compared to the last time they were looking for a new role.

“This isn’t to detract from the news coming out of the ONS findings, but to acknowledge that we should be utilising the wealth of talents available to the job market.”