Following the pattern of recent months, the labour market statistics exhibit a shift towards less secure forms of employment. While the overall employment level continued to rise in the three months to May of this year, the composition of this increase is a source of some concern. The number of full-time employees fell by some 77000, and the number of part-time employees also fell slightly. There was a modest increase in the number of full-time self-employed workers, but the main source of employment growth has been part-time self-employment. This grew by a massive 104000 over the quarter. While many jobs of this kind offer workers the flexibility that they might want, this may come at a cost in terms of insecurity. As parts of the traditional engine room struggle in the current economic climate, workers may increasingly be turning to the gig economy.

The pronounced shift to part-time work is reflected in the data on total hours spent working – which fell slightly over the quarter in spite of the rise in the number of people working.

The news on pay continues to be relatively encouraging, with total pay increasing year on year by some 3.4% (on the three-month measure). This is well ahead of the CPI price inflation measure, currently 2%. But it still represents quite sluggish advances in real pay compared with historical norms, and the average level of real pay remains well below the peak level that it achieved around the start of the recession. The main gains in pay have been in finance and business and in the construction sector. In retail, meanwhile, gains in total pay have lagged behind price inflation, largely to a collapse in bonus pay.


geraint

About the author

Geraint Johnes

Professor of Economics, Lancaster University Management School