Unemployment: Who are the millions of Britons not working?
- Published
About a quarter of people of working-age - nearly 11 million people - do not currently have jobs.
In his Budget, Chancellor Jeremy Hunt set out a series of measures designed to encourage people to find work, or increase their hours.
How many people are unemployed?
Officially, just over 4% of people are unemployed - about 1.4 million people in the UK. While there has been a slight uptick in recent months, unemployment is still relatively low historically.
But the unemployed represent only a small part of the nearly 11 million working-age people (aged 16-64) who are not in a paid job.
About nine million of them are not called "unemployed". That is because they are not actively looking for work, or available to start a job.
In fact, more of them say they want a job (1.7 million people) than are officially unemployed (1.4 million).
Who isn't working - and why?
It varies according to age.
Most of the 2.7 million "inactive" people under 25 are students, according to the Office for National Statistics (ONS). The majority of them do not want a job.
You can see that in the graphic below. Click on the darker border surrounding any age group to see the spilt between men and women.
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Things are different in other age groups.
The main reasons that 3.5 million over-50s are out of the job market are illness and early retirement. Almost nobody who has retired early says they want to return to work.
Among 25- to 49-year-olds, 1.1 million people do not work because of caring responsibilities (about a million of whom are women).
Nearly one million people in this age group are not working because of illness (more evenly split between men and women).
Around half of people with disabilities do not have a paid job, a rate that is more than double the rest of the working age population.
Less than a quarter of those who are sick or caring say they want a job.
Does it matter that people aren't looking for work?
Many people have chosen to do something else: studying, retirement or caring.
But for others it is not a choice.
Some people cannot afford childcare if they return to work, others are too sick, or have given up on finding a job.
As the chart below shows, sickness and caring responsibilities are the most common reasons for inactivity given by those who actually would like a paid job.
The number of people not working has a broader effect.
A smaller workforce means less tax to pay for services like the NHS, and greater spending on benefits.
Since people on benefits generally have less money to spend than those in work, it also means less spending on the high street.
That in turn is bad for businesses and how many people they want to employ.
In turn, that can affect how many jobs are available for those who are job hunting.
How does the UK compare with other countries?
The UK's 'inactivity' rate is back up to the levels seen in 2015.
That is low by historical standards, as each decade more and more women have been joining the workforce.
But the recent trend is unusual.
During the pandemic, all major countries saw their workforce shrink.
But while the other leading economies have since recovered, the UK still has more people out of its workforce than in 2019 - by over 1% of the working-age population.
Before the pandemic, the UK's inactivity rate was second lowest in the G7 club of leading advanced economies, with only Japan's lower. The increase in inactivity shown above now puts the UK fourth out of seven, overtaking Germany and Canada but still below the US, France and Italy.
The Office for Budget Responsibility suggests that the drop since the pandemic that distinguishes the UK is due to ill-health being consistently "a bigger factor" on the island than in the other advanced economies.
What can be done to get more people into work?
A series of reforms were announced in the Budget to help some people get jobs or increase the hours they work. The measures were particularly aimed at:
- current workers
- working parents receiving child benefits
- those that are self-employed
- people claiming disability benefits
These include cutting the rate for national insurance contributions, extending free childcare to ensure single-earner households aren't disadvantaged, and offering more support to help disabled people find paid employment.
Broadening the pool of people given support to return to the job market is key, experts argue.
Stephen Evans from the Learning and Work Institute believes the government needs to widen employment support and invest in social infrastructure, such as childcare, skills and health.
Data visualisation by Callum Thomson, additional reporting by Nicholas Barrett