Lockdown sees biggest fall in working hours since 1971

Early indicators for June 2020 suggest that the number of employees in the UK on payrolls is down around 650,000 compared with March 2020, according to data released by the ONS.

The largest falls were seen at the start of the pandemic and while the number of payroll employees is still falling the decline is slowing. Flows analysis suggests that the falls in May and June are mainly because of fewer people moving into payrolled employment.

In June 2020, the Claimant Count has fallen and experimental monthly data show vacancies have increased slightly.

Employment is weakening and unemployment is largely unchanged, but there are some signs of economic inactivity rising, with people out of work not currently looking for work. Hours worked has continued to fall reaching record lows both on the year and on the quarter.

There are still a large number of people temporarily away from work, including furloughed workers, although this is falling through May. New analysis shows that there were around half a million people away from work because of the pandemic and receiving no pay.

Pay fell for most measures in May 2020, declining more in industries where furloughing was most prominent, many of these being the lowest-paying industries, in particular accommodation and food service activities.

• March to May figures show weakening employment rates, with self-employed and part-time workers seeing reductions; despite these falls, unemployment is not rising, because of increases in people out of work, but not currently looking for work; the reduction in total hours worked is a record both on the year and the quarter despite a third of the period covered being prior to the implementation of coronavirus (COVID-19) measures.
• Early estimates for June 2020 from Pay As You Earn Real Time Information (PAYE RTI) indicate that the number of payroll employees fell by 2.2% (649,000) compared with March 2020.
• The Claimant Count fell slightly in June 2020 reaching 2.6 million; this includes both those working with low income or hours and those who are not working.
• Vacancies in the UK in April to June 2020 are at the lowest level since the Vacancy Survey began in April to June 2001, at an estimated 333,000; this is 23% lower than the previous record low in April to June 2009.
• The three months to May 2020 saw strong falls in pay; total pay fell by 0.3% on the year, this equates to a fall of 1.3% when taking into account inflation.