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National Assembly for Wales Research paper Labour Market Briefing February 2016 Research Service

The National Assembly for Wales is the democratically elected body that represents the interests of Wales and its people, makes laws for Wales and holds the Welsh Government to account. The Research Service provides expert and impartial research and information to support Assembly Members and committees in fulfilling the scrutiny, legislative and representative functions of the National Assembly for Wales. Research Service briefings are compiled for the benefit of Assembly Members and their support staff. Authors are available to discuss the contents of these papers with Members and their staff but cannot advise members of the general public. We welcome comments on our briefings; please post or email to the addresses below. An electronic version of this paper can be found on the National Assembly website at: assembly.wales/research Further hard copies of this paper can be obtained from: Research Service National Assembly for Wales Cardiff Bay CF99 1NA Email: Research@Assembly.Wales Twitter: @SeneddResearch Blog: assemblyinbrief.wordpress.com National Assembly for Wales Commission Copyright 2016 The text of this document may be reproduced free of charge in any format or medium providing that it is reproduced accurately and not used in a misleading or derogatory context. The material must be acknowledged as copyright of the National Assembly for Wales Commission and the title of the document specified. Enquiry no: 16/0456 Paper number: 16/003

National Assembly for Wales Research paper Labour Market Briefing February 2016 Gareth Thomas This briefing paper provides a statistical overview of the labour market. Information is included on Assembly constituencies,wales and UK nations and regions. Research Service

Labour Market Briefing Labour market statistics are published each month by the Office for National Statistics (ONS). This paper is released shortly after the ONS data and aims to provide a brief summary of the latest situation across the labour market in Wales and the UK. This paper includes comparative information on unemployment, employment and economic inactivity rates in Wales and the other UK nations. Additionally, the latest headline labour market figures for Welsh constituencies are provided. The Research Service is able to provide Assembly Members and their staff with more detailed analyses in relation to unemployment and long-term labour market trends on request. If you would like us to do this, please contact Gareth Thomas on 0300 200 6307 or at GarethDavid.Thomas@assembly.wales

Contents 01. Unemployment in Wales... 1 02. Employment and jobs... 3 03. Economic Inactivity... 5 04. What s happening in your constituency?... 7

Definitions of key terms relating to being in and out of work When the Office for National Statistics (ONS) publishes statistics on the labour market, people are classed as being in one of three groups. These are being in employment, being unemployed or being economically inactive. People in employment are those aged 16 and over who did paid work (as an employee or self-employed), those who had a job that they were temporarily away from, those on government-supported training and employment programmes, and those doing unpaid family work; People who are classed as ILO unemployed are those aged 16 and over who are without a job, have been actively seeking work in the past four weeks and are available to start work in the next two weeks, or are out of work and are waiting to start a new job in the next two weeks; and People who are classed as being economically inactive are those aged 16 and over without a job who have not sought work in the last four weeks and/or are not available to start work in the next two weeks. The main economically inactive groups are students, people looking after families and the home, temporary and long-term sick and disabled people, and retired people. There are two main measures of unemployment used by the ONS. In addition to the ILO measure outlined above, the claimant count measures people who are claiming Jobseeker s Allowance (JSA) and Universal Credit. It is lower than the ILO definition, because some unemployed people are either not entitled to claim benefits, or choose not to do so. It is the most up-to-date unemployment measure. To take into account the differences between the number of people in different age groups and geographical areas, the figures in this paper are mainly expressed as rates rather than the number of people. Seasonally adjusted and non-seasonally adjusted data Headline ILO unemployment and claimant count data for Wales and the other UK nations and regions is seasonally adjusted by the ONS. This means that it is statistically adjusted to remove seasonal factors such as holidays and labour market recruitment patterns. For example, a large number of people leave full-time education and enter the labour market in the summer. To make it easier to identify labour market trends the ONS seasonally adjusts this data. Other unemployment data such as that for age groups and Parliamentary Constituencies is not seasonally adjusted by the ONS.

01.Unemployment in Wales This section provides headline information on ILO unemployment rates and the claimant count across the UK. It also looks at unemployment by age. Key points from this section of the briefing include: The latest figures show that the ILO unemployment rate in Wales is 5.3% in October-December 2015, the lowest rate since 2008. (figure 1.1); The claimant count rate has seen a decrease across Wales and the other UK nations over the past three years, although there has been little change over the last six months. Wales claimant count rate has been below only Northern Ireland for this period (figure 1.2); Youth unemployment rates across Wales are higher than for other age groups, and have seen an increase over the past year to 18.3% in October 2014 September 2015. (figure 1.3); Looking across the constituencies, Rhondda has the highest ILO unemployment rate at 10.1%, with Delyn having the lowest at 2.7% in October 2014 September 2015. For the unofficial claimant count statistics calculated by the Research Service, Blaenau Gwent had the highest rate at 5.4% in January 2016, with Brecon and Radnorshire having the lowest at 1.3%. Figure 1.1: ILO unemployment rate in Wales and other UK nations (seasonally adjusted) 10 9 8.9 8.3 8.6 8.4 8.6 Percentage of people aged 16+ who are ILO unemployed 8 7 6 7.9 7.9 7.9 7.8 8.4 7.1 7.8 7.8 7.7 7.3 7.2 7.6 7.2 7.1 7.0 6.7 5.7 5.7 5.7 5.4 5.8 5.8 5.3 Wales Scotland Northern Ireland England UK 5 5.1 5.0 4 2010 2011 2012 2013 2014 2015 Source: Office for National Statistics, Regional Labour Market Statistics February 2016 Headline indicators for all regions and Labour Market Statistics February 2016 Summary of Labour Market Statistics 1

Figure 1.2: Claimant count rate in Wales and other UK nations (seasonally adjusted) 8 7.2 7.2 7 6.7 6.9 7.0 6.4 6.5 6 5.9 5.6 5.6 Percentage of the workforce 5 4 5.2 5.0 4.5 4.3 5.3 5.2 5.2 5.1 4.8 4.7 4.7 4.6 4.7 4.6 5.4 5.0 4.6 4.5 5.1 4.7 4.3 4.1 4.4 3.9 3.8 5.4 4.8 4.2 Wales Scotland Northern Ireland England UK 3.5 3.4 3.3 3.2 3.0 3 2.9 2.9 2.9 2.8 2.7 2.7 2.5 2.3 2.3 2.2 2.1 2.1 2 Jan 2011 Jul 2011 Jan 2012 Jul 2012 Jan 2013 Jul 2013 Jan 2014 Jul 2014 Jan 2015 Jul 2015 Jan 2016 Source: Office for National Statistics, Claimant Count and Vacancies Series Figure 1.3: ILO unemployment rate in Wales by age (not seasonally adjusted) 30 % of economically active workforce 25 20 15 10 5 23.4 24.0 22.2 17.6 6.4 6.3 6.2 5.2 5.6 4.6 4.7 4.3 18.3 4.8 3.3 16-24 25-49 50-64 0 Oct 2010 - Sep 2011 Oct 2011 - Sep 2012 Oct 2012 - Sep 2013 Oct 2013 - Sep 2014 Oct 2014 - Sep 2015 Source: Office for National Statistics, NOMIS Official Labour Market Statistics 2

02.Employment and jobs This part of the paper looks at employment rates across the UK for people of working age (16-64). It also considers changes in employment in the public and private sectors in Wales. The main conclusions that can be drawn from this section include: The working age employment rate in Wales has increased over the past five years, with the current rate being 71.2% in October-December 2015. (figure 2.1); Over the past five years the working age employment rate in Wales has been above Northern Ireland, but below the other UK nations. Over the past five years to quarter 3 of 2015, employment in the private sector in Wales has increased by 6.9%, while employment in the public sector has decreased by 9.3% (figure 2.2); and Looking at the constituency data, 77.5% of people aged 16-64 in Brecon and Radnorshire are in work in October 2014 September 2015. In Cardiff Central, 59.2% of 16-64 year olds are working, the lowest rate of any of the Welsh constituencies. Figure 2.1: Working age employment rate in Wales and other UK nations (seasonally adjusted) 76 Percentage of people aged 16-64 who are employed 75 74 73 72 71 70 69 68 71.7 71.2 71.4 70.9 71.0 70.6 70.3 70.4 70.2 68.6 68.6 67.7 67.5 72.7 72.1 72.0 70.7 67.5 74.4 73.5 73.2 69.2 67.8 74.8 74.4 74.1 Wales Scotland Northern Ireland England UK 71.2 68.8 67.0 67 66 65.9 65 2010 2011 2012 2013 2014 2015 Source: Office for National Statistics, Regional Labour Market Statistics February 2016 Headline indicators for all regions and Labour Market Statistics February 2016 Summary of Labour Market Statistics 3

Figure 2.2: Percentage change in employment in public and private sectors over past five years (not seasonally adjusted) 15 Percentage change in employment between quarter 3, 2010 and quarter 3, 2015 10 5 0-5 -10 10.7 10.0 10.3 8.2 6.9 6.5 6.8 7.2 4.8 3.0 Wales Scotland Northern Ireland UK England -4.2-6.5-6.7-6.5-9.3 Public sector Private sector Total -15 Source: Office for National Statistics, Public Sector Employment, Quarter 3 2015 4

03.Economic Inactivity This part of the paper looks at people outside the labour market, those who are classed as being economically inactive. This includes people aged 16-64 without a job who have not sought work in the last four weeks and/or are not available to start work in the next two weeks. The graphs below consider the economic inactivity rate for people of working age across the UK, and look at the reasons why people in Wales are economically inactive. The key points from this section of the briefing are: Wales has had a higher working age economic inactivity rate than the UK average throughout the past five years. This has fluctuated over the past five years, and is 24.6% in October - December 2015 (figure 3.1); The main reasons given by economically inactive people in Wales in October 2014 September 2015 were temporary and long-term sickness (30.3%), being a student (25.4%) and looking after the family/home (20.6%) (figure 3.2); and At constituency level, Cardiff North had the lowest working age economic inactivity rate in October 2014 September 2015, at 17.3%, with Cardiff Central having the highest at 36.2%. This is partially due to the high number of university students living in Cardiff Central. Figure 3.1: Working age economic inactivity in Wales and other UK nations (seasonally adjusted) 29 28 28.3 28.0 27 27.2 27.4 27.0 26.8 Percentage of people aged 16-64 who are economically inactive 26 25 24 23 22 26.0 24.6 23.5 23.2 23.3 23.1 22.5 22.4 24.8 23.1 22.4 22.0 23.8 22.3 22.1 21.5 25.7 22.3 22.0 21.3 24.6 21.8 21.6 Wales Scotland Northern Ireland England UK 21 20.5 20 2010 2011 2012 2013 2014 2015 Source: Office for National Statistics, Regional Labour Market Statistics February 2016 Headline indicators for all regions and Labour Market Statistics February 2016 Summary of Labour Market Statistics 5

Figure 3.2: Reasons for working age economic inactivity in Wales, October 2014 September 2015 (in %) Temporary/long-term sick 30.3% Student 25.4% Looking after family/home 20.6% Retired 15.0% Other 8.2% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% Percentage of people stating reason for economic inactivity Source: Office for National Statistics, Regional Labour Market Statistics January 2016 Headline indicators for Wales 6

04.What s happening in your constituency? Table 4.1 sets out the latest headline labour market statistics for Welsh constituencies. The constituencies with the best performance for each variable are highlighted in yellow, and the worst performing constituencies highlighted in purple. Additional information on the labour market in your constituency including comparisons over time is available on the Research Service constituency support pages. Table 4.1: Headline labour market statistics by Welsh constituency, October 2014 September 2015 ILO unemployment rate 16+ Unofficial claimant count rate (Jan 2016) Economic Inactivity rate 16-64 Employment Constituency rate 16-64 Aberavon 8.6 3.7 61.8 32.2 Aberconwy 3.1 3.0 71.6 25.9 Alyn and Deeside 2.8 2.1 77.0 20.7 Arfon 7.2 3.6 70.1 24.3 Blaenau Gwent 9.2 5.4 67.0 26.2 Brecon and Radnorshire 2.8 1.3 77.5 20.2 Bridgend 6.2 2.7 73.4 21.7 Caerphilly 7.5 4.4 66.6 28.0 Cardiff Central 7.5 3.5 59.2 36.2 Cardiff North 6.9 1.7 77.0 17.3 Cardiff South and Penarth 7.4 3.5 67.2 27.3 Cardiff West 6.9 3.7 72.7 21.8 Carmarthen East and Dinefwr 7.4 2.3 65.4 29.0 Carmarthen West and South Pembrokeshire 5.0 3.2 72.4 23.6 Ceredigion 5.1 1.7 64.4 32.0 Clwyd South 5.0 2.4 76.6 19.2 Clwyd West 6.0 3.0 72.8 22.3 Cynon Valley 8.3 4.1 69.9 23.6 Delyn 2.7 2.3 67.7 30.3 Dwyfor Meirionnydd 6.0 2.2 68.4 26.9 Gower 5.0 2.0 73.6 22.6 Islwyn 8.9 4.0 66.4 27.0 Llanelli 5.7 2.8 70.4 25.3 Merthyr Tydfil and Rhymney 6.3 4.7 67.6 27.7 Monmouth 3.6 1.6 75.8 21.1 Montgomeryshire 4.3 1.5 76.8 19.4 Neath 4.0 3.4 71.5 25.4 Newport East 6.5 3.8 71.6 23.3 Newport West 6.0 4.0 70.8 24.6 Ogmore 9.0 3.0 67.4 25.7 Pontypridd 4.6 2.4 70.9 25.6 Preseli Pembrokeshire 5.8 3.0 74.3 21.0 Rhondda 10.1 5.1 65.0 27.5 Swansea East 9.9 3.7 68.8 23.6 Swansea West 9.1 3.9 64.8 28.5 Torfaen 7.1 3.6 70.4 24.1 Vale of Clwyd 5.4 4.0 68.5 27.4 Vale of Glamorgan 6.1 3.0 72.5 22.5 Wrexham 5.5 2.8 75.1 20.6 Ynys Mon 6.0 4.2 74.4 20.7 Source: Office for National Statistics, Regional Labour Market Statistics February 2016: Table LI02 Local Indicators for Parliamentary Constituencies and Regional Labour Market Statistics February 2016: Table CC02 Claimant Count for Parliamentary Constituencies (experimental) 7

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