The latest data from the Office for National Statistics (ONS) show the labour market continues to recover.

Employment levels

The number of payroll employees showed another monthly increase, up 241,000 to 29.1 million in August 2021, returning to pre-coronavirus (COVID-19) pandemic (February 2020) levels. All regions except London, Scotland and South East are now above pre-pandemic levels, the ONS reported.

Following a period of employment growth and low unemployment, since the start of the pandemic the employment rate has generally decreased, and the unemployment rate has increased. However, since the end of 2020, both have shown signs of recovery. In the latest period (May to July 2021), there was a quarterly increase in the employment rate of 0.5 percentage points, to 75.2%, and a decrease in the unemployment rate of 0.3 percentage points, to 4.6%. The economic inactivity rate is down 0.3 percentage points on the previous quarter, to 21.1%.

Weekly hours worked in the UK increased on the previous quarter, to 1.01 billion hours in May to July 2021, coinciding with the relaxing of coronavirus lockdown measures. However this remains below pre-pandemic levels.

Young people and employment

Young people (those aged 16 to 24 years) have been particularly affected by the pandemic, with the employment rate decreasing and the unemployment and economic inactivity rates increasing by more than seen for those aged 25 years and over. Over the last quarter, however, there was a strong increase in the employment rate and decrease in the unemployment and inactivity rates for young people.


Vacancies reached a new record high, primarily driven by the hospitality sector. The number of job vacancies in June to August 2021 was 1,034,000, this is the first time vacancies have risen over 1 million since records began, and is now 249,000 above its pre-pandemic January to March 2020 level. Vacancies grew on the quarter in June to August 2021 by 269,300 (35.2%), with all industry sectors increasing their number of vacancies and the majority reaching record levels; the largest increase was seen in accommodation and food service activities, which rose by 57,600 (75.4%).


Total wages in the three months to July rose by 8.3% on the same period in 2020 and by 6.8% when stripping out bonuses however, the ONS cautioned these rises are partly the result of statistical factors, and the underlying picture suggests more modest pay rises.