>The UK labour market is in a better state than official data suggests, according to new analysis that finds there has been no surge in the rate of economic inactivity since the pandemic.
>The Office for National Statistics’ labour force survey, the main source of data on unemployment, has suffered from a sharp drop in response rates and a potential bias in the types of people likely to respond.
>This official data has led policymakers to focus on a problem apparently unique to the UK: while other countries registered a post-pandemic surge in employment, Britain’s workforce shrank with a rising share of people saying long-term health conditions stopped them looking for a job.
>But Adam Corlett, principal economist at the Resolution Foundation, said these figures “misrepresented” what had happened in the jobs market and had given policymakers “an overly pessimistic picture”.
>A report published on Wednesday by the think-tank paints a very different picture.
>Its estimates are based on HMRC tax records that suggest the LFS has been underestimating growth in the workforce by some 930,000. They are also based on the latest population data, which reflects two years of record high immigration and which the ONS has not yet applied to the LFS.
>Corlett said the administrative data suggested the UK’s employment rate for 16 to 64-year-olds was around 76 per cent, as it was before the pandemic, rather than its official rate of around 75 per cent.
>It is less certain whether those not working are unemployed, or choosing to step out of the labour market. But Corlett said that based on historic patterns, the rate of economic inactivity was likely to be little changed from its 2019 rate — at around 36 per cent of the population aged over 16.
tebbus on
Glad that was a newspaper/radio talking point for the last year..
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>The UK labour market is in a better state than official data suggests, according to new analysis that finds there has been no surge in the rate of economic inactivity since the pandemic.
>The Office for National Statistics’ labour force survey, the main source of data on unemployment, has suffered from a sharp drop in response rates and a potential bias in the types of people likely to respond.
>This official data has led policymakers to focus on a problem apparently unique to the UK: while other countries registered a post-pandemic surge in employment, Britain’s workforce shrank with a rising share of people saying long-term health conditions stopped them looking for a job.
>But Adam Corlett, principal economist at the Resolution Foundation, said these figures “misrepresented” what had happened in the jobs market and had given policymakers “an overly pessimistic picture”.
>A report published on Wednesday by the think-tank paints a very different picture.
>Its estimates are based on HMRC tax records that suggest the LFS has been underestimating growth in the workforce by some 930,000. They are also based on the latest population data, which reflects two years of record high immigration and which the ONS has not yet applied to the LFS.
>Corlett said the administrative data suggested the UK’s employment rate for 16 to 64-year-olds was around 76 per cent, as it was before the pandemic, rather than its official rate of around 75 per cent.
>It is less certain whether those not working are unemployed, or choosing to step out of the labour market. But Corlett said that based on historic patterns, the rate of economic inactivity was likely to be little changed from its 2019 rate — at around 36 per cent of the population aged over 16.
Glad that was a newspaper/radio talking point for the last year..
Also a reminder that the resolution foundation are one of very few think tanks in the country that [score an A for funding transparency.](https://www.opendemocracy.net/en/who-funds-you/)