Early signs of unemployment easing but almost 700,000 people fewer workers than in February of last year

The number of workers on UK payrolls increased for the third month in a row in February as firms begin to take on staff, but nevertheless the number is down by nearly 700,000 since the start of the pandemic, according to official figures.

The Office for National Statistics said the number of payrolled workers rose by 68,000 (0.2 per cent) between January and February.

Overall there were 693,000 fewer workers on payrolls than in February 2020, with more than half – 368,000 jobs – lost in the hospitality sector as lockdowns and restrictions hammered the industry.

The ONS added that 123,000 payroll jobs were also lost in the hard-hit retail sector.

The latest figures show the rate of unemployment stood at five per cent between November and January, compared with 5.1 per cent in the previous three months.

The number of people claiming work-related benefits such as Universal Credit through being out of work or not having enough work hours is also remaining well up on the same month last year.

Locally in the Lancashire Parliamentary constituencies, Blackpool South had the highest number of people claiming benefits. It had 6,665 claimants or 13.6 per cent of the population there, a figures which is up 5.9 per cent on February last year.

Blackpool North had 4,755 claimants, 9.7 per cent of the population and up 4.6 per cent on last year. Preston had 5,540 claimants, 8.5 per cent of the population and up 3.8 per cent on last February.

Chorley had 3,075 claiming, 4.8 per cent of the population and up 2.3 per cent, Fylde had 2,620 claiming, 5.3 per cent of the population, up 3 per cent on last year.

Lancaster and Fleetwood had 3,165 claimants, 3.3 per cent of the population, a figure up 2.4 per cent on last year.

Ribble Valley had 2,240 claiming, up 2.3 per cent on last year, South Ribble had 2,275 claimants, up 2 per cent and Wyre and Preston North had 1,895 claimants, up 2.2 per cent on February last year.

Overall, unemployment stood at 1.7 million between November and January, up 360,000 over the year, the ONS said.

The figures show a slight improvement since the start of the pandemic, with 601,000 vacancies between December and February.

The ONS also said growth in average pay excluding bonuses rose to 4.2 per cent in the three months to January from 4.1 per cent in the previous quarter, but stressed that, with a high proportion of jobs axed being lower-paid roles, the underlying increase is likely to be around 2.5 per cent.

Sam Beckett, ONS head of economic statistics, said: “After yet another monthly increase, there were almost 200,000 more employees on payroll in February than three months earlier, although that is still nearly 700,000 down from the start of the pandemic.

“Of the decrease since then, almost two-thirds has been among the under-25s, over half has been in hospitality and almost a third has been in London.”

Minister for Employment Mims Davies said: “Today’s figures highlight the challenges facing us on our road to recovery, but there is reason for optimism with more workers on payrolls and over half a million vacancies out there.”

Head of Economics at the British Chambers of Commerce, Suren Thiru, said: “While unemployment rose slightly, the continued uptick in the timelier payroll employment data indicates that the UK jobs market is becoming more resilient. 

“Ongoing wage support, greater clarity provided by the government’s roadmap and the adaptations made by some firms to operate under lockdown restrictions helped support higher payroll employment in February.

“Extending furlough will limit the peak in job losses. However, with many firms struggling with the damage done to their cashflow by a year of covid restrictions, unemployment is likely to remain on an upward trajectory until well beyond a full reopening of the economy.

“While the extension to the job support schemes will protect millions of jobs and livelihoods, it is vital that those businesses and individuals who remain excluded from government support get the assistance they need to navigate a difficult period.”