Analysis
By Gavin Mochan
Unemployment fell last month as roaring demand for staff gave those made redundant during the pandemic the opportunity to re-enter the labour market, but there is evidence that some groups are being left behind in the transition back to work.
According to yesterday’s figures from the Office for National Statistics (ONS), unemployment in Scotland dipped to 4.3 per cent in the three months to June, down 0.1 percentage point on the previous three months. This compared favourably to the UK figure of 4.7%, though here again there was a decline, down 0.2 percentage points.
The fall in unemployment has of course been supported by the easing of lockdown restrictions that has allowed most of the economy to re-open. Even so, the proportion of the working population out of work is still higher than it was immediately prior to the pandemic, with 24,000 fewer people employed in Scotland than before the first lockdown.
Despite these headwinds, data from the ONS show the number of job vacancies in July across the UK surpassed the one million mark for the first time on record.
In June there were more than 70,000 vacancies advertised across Scotland, far more than the average of 47,000 in the three months before the first lockdown. Though this fell in July, the 19% drop from June is typical as we move into the traditionally slower hiring months of the summer. In addition, the overall volume of vacancies of almost 60,000 was much higher than in pre-lockdown months.
Provisional data released at the end of last month by HMRC puts the total number of people on furlough across the UK at 1.9 million. According to Scottish Secretary Alister Jack, the job retention scheme continues to support 141,500 jobs in this country.
That’s down from 4.2 million furloughed jobs across the UK at the end of March, when evidence began to emerge that for the first time during this pandemic, younger workers are beginning to shed their status as the biggest economic losers of the crisis.
At that time, people between the age of 16 and 24 made up just 18% of the furlough pot, while those over the age of 50 represented 28% of furloughed jobs. According to the provisional data released at the end of July by HMRC, that trend continued with almost 600,000 under-25s coming off furlough during the three months to the end of June, double the pace of all other age brackets.
It’s not surprising that the young are doing better now that lockdown has all but ended, as demand for staff in their typical job-hunting grounds of hospitality and retail has surged with the easing of restrictions. Government has also played its part by weighing support measures such as the Young Person’s Guarantee towards the fledgling labour market.
As we approach the end of the job retention scheme in September it will be important to monitor the impacts of these programmes to ensure no one is left behind, as the data currently suggest that those over 50 may now be in most need of additional support.
Gavin Mochan is comercial director at s1jobs.
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