UK unemployment rate at highest for five years according to ONS


According to data released by the Office for National Statistics (ONS) this morning, the UK’s unemployment rose to 5.1% in the three months to December – the highest the rate has been in five years.

ONS revealed that more than 1.74 million people were unemployed in the October to December (Q4) period. This is an increase of 454,000 from the same quarter in 2019. The data showed that 726,000 less people are currently employed than before the start of the pandemic – 425,000 of which are those aged less than 25 years old.

However, there was a cause for optinimism as last month, 83,000 more people were in employment when compared to the end of December 2020.

Jonathan Athow, ONS deputy national statistician for economic statistics said: “Our survey shows that the unemployment rate has had the biggest annual rise since the financial crisis. However, the proportion of people who are neither working nor looking for work has stabilised after rising sharply at the start of the pandemic, with many people who lost their jobs early on having now started looking for work.”

The Chancellor of the Exchequer, Rishi Sunak, said: “I know how incredibly tough the past year has been for everyone, and every job lost is a personal tragedy. At the Budget next week I will set out the next stage of our Plan for Jobs, and the support we’ll provide through the remainder of the pandemic and our recovery.”

Industry reaction

Anthony Impey MBE, CEO of Be the Business said: “Before the pandemic UK productivity was already growing slowly when compared to historic standards. These figures confirm the additional impact COVID-19 had on UK productivity. However, while coronavirus has placed an incredible burden on every business, it has pushed many companies to innovate and invest in productivity-enhancing technology. This will support a return to productivity growth if businesses continue to prioritise these key areas once the effects of the pandemic begin to stabilise.”

James Reed, Chairman of REED, said: “Today’s ONS unemployment statistics might raise further alarm bells about the economic emergency. However, despite the third national lockdown, the labour market has shown some encouraging signs of recovery since December.

“Job postings on were up by nearly a third (31%) in January compared to December, and there has been a surge of new jobs added in February with over 165,000 added in the first three weeks of the month – with Customer Service, IT & Telecoms, and Health & Medicine being the most active sectors.

“Thanks to the success of the vaccine roll-out, the recovery is expected to accelerate as current restrictions are eased in the coming months. But the Government must continue to support employers and workers as we transition back to some sense of normality.

“The furlough scheme continues to be a lifeline for businesses. An extension should be considered for those who will still need support beyond April while a phased easing of lockdown measures takes place across different sectors.

“However, more targeted support is also needed for those whose livelihoods have been disproportionately affected by the pandemic – including women, workers from BAME backgrounds and the youngest and oldest among the UK workforce. The Chancellor’s March Budget is an opportunity to begin rebuilding a fairer economy that holds the Prime Minister to his word that this will be the last lockdown.”

David Morel, CEO, Tiger Recruitment said: “There are encouraging signs in today’s ONS data that the jobs market is over the worst of the pandemic. While vacancies in the period November to January are down on a year ago, they are up by 64,000 from the previous quarter, with recent indications that large employers in particular are starting to increase their vacancies. Positive pay growth was also recorded in all sectors in October to December.

“We’re seeing this upward trend in our own business, reflected in an uplift in jobs advertised across job board platforms, along with an increase in new roles being briefed into our office. The success of the vaccination programme, coupled with PM Boris Johnson’s cautious but clear roadmap for opening up the economy is restoring employer confidence. As a result, a number of our clients are planning to recruit roles in the next few weeks that have previously been on hold.”