And getting back to pre-recession wages is going to take an awfully long time
Today’s employment figures show that the overall picture hasn’t changed a great deal:
- Employment is still rising, with another record employment level. The employment rate of 73.2 per cent was briefly equalled in 2005, but has not been surpassed since these records began in 1971.
- Unemployment fell again, with the rate and level falling to their lowest since 2008.
- There are a record number of vacancies, and the number of unemployed people per vacancy – 2.6 – is now roughly where it was before the recession.
Until 2013, the highest women’s employment rate was 67.1 per cent, which had been achieved a few times. Women’s employment rate has been over that for a year and currently stands at 68.5 per cent. Men’s unemployment rate has fallen 1.6 percentage points in the past year; if it falls 1.1 it will reach its lowest ever.
Once again, young people are the furthest from benefiting from this recovery. There were 740,000 unemployed 16 – 24 year olds in October – December, up slightly from 737,000 in July – September. Long-term youth unemployment has fallen significantly in the last year, but we have a way to go before we get back to pre-recession levels and the picture is somewhat worse the longer the period of unemployment we consider:
Long-term 16 – 24 unemployment (000s), Oct – Dec quarters
| 6 months plus | 12 months plus | 24 months plus | |
| 2008 | 253 | 118 | 37 |
| 2013 | 428 | 260 | 115 |
| 2014 | 313 | 201 | 85 |
Although earnings are finally rising in real terms, there is a huge gap to make up. December was the first month since 2009 in which average weekly earnings (including bonuses) rose at a faster annual rate than the Retail Price Index, which is the measure of inflation usually used for pay negotiations. This means that, in our real pay chart, real pay increases – the green columns – are finally positive:
Average weekly earnings, RPI inflation and real pay increases
So pay didn’t go down in real terms (hurrah!) but the increase was only about 0.5 per cent. Just getting back to the real wages we had before the recession will take an awfully long time at this rate – at the TUC we’ve projected forwards real earnings at the current monthly rate of growth (using the CPI measure of inflation, which is less favourable to our case) and we calculate that it will still take until the end of the next Parliament to achieve this.
And returning to the pre-recession real value of wages would not be a mark of success. Before the recession, real wages grew at an annual rate of 1 to 1.5 per cent, depending on where you start and finish your measurements. If we had maintained that rate of growth, average weekly earnings would be £80 to £100 higher than the current figure of £489.
Richard Exell is senior policy officer at the TUC. Follow him on Twitter
To reach hundreds of thousands of new readers and to make the biggest impact we can in the next general election, we need to grow our donor base substantially.
That's why in 2024, we are seeking to generate 150 additional regular donors to support Left Foot Forward's work.
We still need another 124 people to donate to hit the target. You can help. Donate today.
8 Responses to “Labour market: Young people are the furthest from benefiting from this recovery”
Guest
Lord Blagger, I don’t care about your lies. Yes, you only have a few million, with a “small” pension you comfortable live off, etc. You own an estate, blah blah.
And of course you oppose education locally, no surprise there, as you work to sabotage English education for people who are Other, as you coach younger rich people in how to asset strip, etc.
You want to return to a time which never was, to empower you and your rich as they were before, against the workers of this country. You keep talking about the “damage” done by a decent education, as you talk about your role in firing people and whine that you didn’t get enough cash, as you’re standing high and dry above the floor which is affecting the peons.
You didn’t even try and address what I said, of course, and you’ll whine at 10% of your hyperbole.
And stop trying to call for genocide against workers because of your hatred of pensions, LB.
Jacko
This is who I think you are:
5ft 8 or less
Scrawny build
Pale conplexion
Glasses
Beard
Brown hair
You very rarely buy clothes, but when you do, you shop at M&S.
Main hobby is computer games, and this website.
Few, if any, friends.
Never married, no girlfriend
Possibly a virgin.
In everyday life, wouldn’t say boo to a goose.
Obviously I don’t expect you to agree with any of that, but I think its 80% correct.
Guest
Keep describing yourself.
You don’t think either? Well, there you go, as you try and make up statistics to “prove” things…you can’t argue with the prior post, so you whine and talk about yourself…you’re a good narcissist.