Monday, May 23, 2022

East Midlands unemployment rate hits lowest point in seven years

The East Midlands’ unemployment rate has fallen to its lowest point on record, new figures show.

It was 3.5% for the period between September and November last year, compared to a 4.1% national average.

This is the lowest level since the Office for National Statistics (ONS) began publishing regional labour market figures in April 2015, and represented the smallest proportion of the workforce being unemployed since the three months to December 2019, when the rate was 3.6%.

It also marked a significant drop on the previous reporting period for August to October 2021, when the region’s unemployment rate was on par with the UK average at 4.2%.

East Midlands Chamber Chief Executive, Scott Knowles, said: “This is fantastic news for the region’s labour market and sends a clear signal that the East Midlands is open for business.

“It reflects our own research that indicates our region’s firms are creating jobs to meet strong demand following the effects of the pandemic. The Chamber’s latest Quarterly Economic Survey (QES) for Q4 2021 showed two-thirds of companies attempted to recruit, while a net 35% expect to increase their headcount in the first three months of 2022.

“We are represented by a very diverse economy in the East Midlands but there have been some standout sectors to celebrate in recent times, such as the logistics industry that has been a major driver of job creation during the pandemic, which has accelerated pre-existing online shopping trends.”

Tightening labour pool presents acute challenge for businesses

While the East Midlands has one of the lowest unemployment rates for over-16s in the UK, the economic inactivity rate for people aged 16 to 64 rose from 21.02% to 22% in the most recent reporting period.

UK job vacancies also soared to a record high of 1.24 million between October and December – 462,000 higher compared with the three months before the pandemic.

Scott added: “Despite the positive trajectory in unemployment, businesses are still encountering major recruitment challenges in a super competitive jobs market.

“The 0.8% increase in the economic inactivity rate represents a rise in the number of people who have opted out of employment, whether it’s for studying, caring or to take early retirement – with the latter being a noticeable trend during the pandemic.

“This means the labour pool is tightening at a time when companies are desperately trying to fill roles to cope with demand, which will enable them to continue growing and creating more jobs for local people.

“Many companies in traditional industries such as manufacturing and construction often tell us about the difficulties in replacing an ageing workforce with younger talent, and the latest QES showed that eight in 10 of those that attempted recruitment struggled to find people with the right skills.

“As we await publication of the Government’s delayed Levelling Up White Paper, the wider context behind the latest ONS data illustrates the need for policymakers to understand how we can pull the right levers in order to support the local economy’s requirements.”

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