UK's employment rate at record high pre-lockdown
The UK’s employment rate was at a record high of 76.4% before the lockdown began, Office for National Statistics figures show.
This equalled 33.07 million people in employment between December 2019 and February 2020, an increase of 352,000 from the previous year.
Economic activity, measured by those without a job who are not actively seeking to work or cannot work aged between 16 and 64 years old, was at a record low of 20.2%.
The employment rate for women was at a record high of 72.7%, partly due to changes to state pension changes meaning fewer women were retiring between the ages of 60 and 65 years old.
For December 2019 to February 2020, the number of women working full-time increased by 10.1% compared with the same period four years ago.
Pay in February continued to grow faster than inflation, but its rate of growth has slowed since the middle of last year. The estimated growth for pay excluding bonuses in the three-month period was 2.9%.
The UK unemployment rate was largely unchanged at 4%, breaking down to 4.2% for men and 3.7% for women.
Though these figures paint a fairly promising picture, next month’s are expected to demonstrate the catastrophic impact the coronavirus pandemic has had on the labour market.
Norman Pickavance, CEO of think tank Tomorrow’s Company and chair of the Financial Inclusion Alliance, warns we will see mass unemployment.
Speaking to HR magazine, he said: “We are beginning to see the fragility of the employment market that we’ve been talking about.
"Furloughed workers are taking home 80% of what they would have had and for the working poor this is 80% of a salary that was already just managing to pay the bills. It’s why we’ve seen massive increase in use of food banks- there’s a direct correlation between the two.”
Those working in zero hour’s contracts will find the lockdown even more challenging, Pickavance said.
He added: “Workers on these low hour or zero hour contracts have no commitments other than that, so some of those people’s employers haven’t applied for furloughing.
"The challenge we have is with the massive economic slowdown that we are seeing, when we come to the end of lockdown, we are going to witness a lot of employers saying I can’t afford to keep you on the books. The whole of the economy is going to contract and I’m very worried about mass unemployment.”
There were an estimated 795,000 vacancies in the UK in January to March 2020, 6,000 fewer than the previous quarter.
Lee Biggins, founder and CEO of CV-Library, said the figures demonstrate where the UK labour market is heading.
“With both pay and vacancies dropping, we can see that businesses were already nervous because of Brexit and the start of COVID-19 social distancing measures.
"What we will see in the next few months is a real shift whereby candidates won't hold as much power as they have done in recent years. The unemployment rate is expected to soar and this is going to have a massive impact on our economy, especially as job numbers drop. Our own data shows that vacancies fell by 4.1% in Q1 2020 and this is likely to continue into the next quarter."
HR may need to be involved in large-scale job cuts over the coming months, something which Phil Pepper, head of employment at law firm, Shakespeare Martineau, warned will be extremely taxing.
He said: “Large-scale job cuts may lead to complex redundancy situations requiring collective consultation, designing and training managers on completing selection matrix forms, and assisting in individual consultation or appeal meetings with employees selected for redundancy.
“There may also be an increase in the number of grievances received and higher levels of sickness absence to deal with throughout the redundancy process.
"The nature of making large numbers of redundancies could mean that businesses find themselves exposed to greater numbers of employment tribunal claims arising from the staff reductions.”