Labour Market Update – November 2023


Labour Market Update – November 2023

Labour Market Overview

As a leading provider of human resource solutions across the region we wanted to share with you latest trends and insight for the month of November.

The latest ONS Labour Market Overview continues to be the adjusted experimental data and reported:

  • UK unemployment rate was largely unchanged at 4.2%, 1.44 million people unemployed
  • Unemployment amongst young people remains high (aged 16-17 = 18.6% / aged 18-24 = 11.7%)
  • Employment rate decreased slightly to 75.7%
  • UK economic inactivity rate was largely unchanged on the quarter at 20.9%
  • 8.73 million people are economically inactive, just 3,000 higher than the last quarter
  • Economically inactive is still 280,000 higher than pre-pandemic levels, and a record 606,000 are classified as long-term sick but want to have a job
  • Vacancies fell again to 957,000, the 16th consecutive period fall, down 257,000 from a year ago, but higher than pre-covid levels
  • Payrolled employees remained similar to the previous quarter at around 30.2 million, up 342,700 over the 12-month period
  • Annual growth in regular pay without bonus increased by 7.7%, and with bonus by 7.9%. Adjusted for inflation, annual growth regular pay was 1.3% and total pay was 1.4%
  • Redundancies were 3.4 per thousand employees, an increase on previous quarter and similar to pre-pandemic level

The Office for National Statistics also reported that the gender pay gap, which measures the difference between average hourly earnings of men and women, increased slightly in 2023 from 7.6% to 7.7%. However, the gender pay gap for the over 40s is double that for younger people.

The biggest ever increase to the National Minimum Wage of 9.8% has been announced, with the National Living Wage due to rise to £11.44 an hour from April 2024, and extended for the first time to all workers aged 21 and over.

The Government published the outcome of their consultation on holiday pay, closely followed by draft Regulations to come into force with effect from 1st January 2024, although the earliest implementation date is not until 1st April 2024. The draft Regulations simplify the calculation of holiday pay for the majority of agency workers and introduce legal rolled up holiday pay.

Early in the month, GLAA issued a new brief on how they would enforce holiday pay.  The ALP and REC collaborated on a joint position in opposition to the brief, which was suspended following the publication of the new draft holiday pay regulations.  GLAA has committed to consulting with ALP before any re-writing or re-introduction of the brief

Section 193 of the Police, Crime, Sentencing and Courts Act 2022 came into force on 28 October 2023 meaning that criminal convictions become spent after a shorter time, reducing the period that individuals are legally required to declare them to their employers.

The ALP UK Food Supply Chain Survey Results – October 2023 has been published. Key findings in the last 6 months include:

  • 79% of labour providers were unable to meet all their client’s labour requirements
  • 48% of businesses are experiencing labour shortages
  • 68% of labour providers stated the biggest impact of labour shortages is increased recruitment costs
  • 62% of business have seen labour costs increase in 2023
  • 56% of labour providers are supplying fewer workers
  • Only 28% of labour providers tried to pass on increased recruitment costs. Most clients haven’t covered these increased costs

The REC’s latest Report on Jobs indicated that recruitment activity continued to be dampened by economic uncertainty in October. Permanent placements fell, albeit to the weakest extent in four months, as employers were hesitant to commit to new permanent hires. Temp billings meanwhile rose slightly as some firms looked for flexibility in workforces, according to recruiters. The supply of candidates rose at a sharp and accelerated pace.

Standout CV has completed a study into job adverts online that are not what they seem. They looked at over 91,300 job listings and found:

  • 34% of listings were ‘ghost jobs’
  • Veterinary nurses and software engineers were the most likely to face ghost jobs
  • The worst area for ghost jobs in the UK was Islington in London and Southend-On-Sea
  • Recruiters use ghost jobs to build their database

Immigration Update

The Guardian reports that a majority of the British public now hold positive views about the impact of immigration on the UK, despite intense political rhetoric surrounding the issue, according to the European Social Survey. They sampled attitudes every two years since 2001 and found British views on immigration and its economic and cultural impact had undergone a ‘complete about-turn’ over the past two decades, becoming significantly more favourable after 2016.

The House of Commons Library has published its latest research briefing on Immigration Fees. People who want a visa, permission to stay or citizenship in the UK usually have to pay for it. Fees have risen significantly over the past 20 years, most recently in October 2023. For example, applications to settle in the UK indefinitely used to be free but now cost £2,900. The government deliberately charges above the cost of processing applications to help fund the wider borders and immigration system.

The Migration Observatory has reported on three key challenges that continue to affect the EU Settlement Scheme:

  • Late applications – there are no figures available on how many EU citizens were eligible to apply nor the numbers that have not applied. The numbers of late applications have not consistently declined and have remained at 15,000 per month throughout 2022 and 2023. Applicants applying now will face stricter rules to be eligible
  • Pending applications and the EUSS backlog – in June 2023, around 154,000 applications were still awaiting a decision, although this was down from the peak of 600,000 around the June 2021 deadline
  • Loss of status – the decision to extend pre-settled status by two years pushes the problem into the future. It is not clear how many will be eligible for an automatic upgrade to settled status, but there is a risk some people will be missed as they don’t have an administrative trail e.g pay tax or withdraw benefits

The government announced on 15th May 2023 that 45,000 visas, the same as 2023, will be made available to the horticulture sector in 2024. It has now been confirmed that each of the six operators has an equal allocation of 7,500 Certificates of Sponsorship and will shortly be able to draw these down to recruit workers and confirm returnees for the 2024 season.


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