Movement into and out of work

The number of people moving into work after being unemployed has fallen while the number moving into work from being inactive has risen. People who were unemployed a year previously are now more likely to be low paid than a decade earlier.

The number of people moving from employment to unemployment has been falling since 2009, albeit unevenly. On average in the first two quarters of 2015, 340,000 people became unemployed having been in work the previous quarter. This was the same figure as the 2014 average, and roughly the same as the average quarterly figure before the recession, which was 330,000 in 2007. The number of people in work becoming unemployed from quarter to quarter peaked in 2009 at 480,000. Expressing the 2015 figure as a proportion of those in work, it is equivalent to around 1 per cent of people in employment becoming unemployed each quarter.

On average, 490,000 unemployed people moved into employment each quarter in 2015, down from a peak of 600,000 in 2012. This figure rose during the recession, largely as there were more unemployed people who could move into work. In some sense, then, a fall in this figure is welcome. The number of inactive people becoming employed has increased since 2013, from 450,000 per quarter to 530,000. The 530,000 figure is very similar to those in the years immediately preceding the recession. These flows do not reflect all possible labour market transitions – it does not include, for example, those moving from unemployment to inactivity or vice versa. Taking all flows into and out of work into account, on average in 2015 130,000 more people moved into employment than left it. This is higher than the pre-recession levels, which were generally below 100,000.

The second graph looks at the pay status of those who were unemployed 12 months earlier but are now in work. On average in the spring quarter of the three years up to 2004, 290,000 people who were unemployed 12 months previous were in work. Of those, 160,000 or 53 per cent were paid below two-thirds of the median hourly pay rate. In the three spring quarters up to 2014, 560,000 people who had been unemployed 12 months earlier were in work. The higher number reflects the labour market recovery in this period. Of these 560,000 people, 340,000 or 60 per cent were in low-paid work.

Indicator: 19A

Indicator: 19B

about the indicator

The first graph shows the average number of working-age adults moving from employment to unemployment, unemployment to employment, and inactivity to employment over time. It also shows the net movement into employment, which includes other flows not shown on the graph. Each year is an average of four quarters of flows.

The second graph shows the number of adults who were unemployed 12 months previously who are now in work by whether or not they are paid above two-thirds of the UK median hourly wage. The data is an average of three years’ worth of quarter two data up to 2004 and 2014 respectively.

Reliability: medium. The first graph comes from experimental statistics from the Labour Market Statistics release. These are not designated as national statistics and must be viewed with some caution. The second graph is drawn from official survey data, which is collected for one quarter each year. This means it covers a relatively broad time period during which there may be changes in the labour market.

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