Random Analytics: Peak Employment (Part II): UK
by Shane Granger
I recently published a blog looking at Australian Peak Employment. Given some very good feedback and responses from the UK especially I thought it might be useful to have a similar look at the situation there.
Although the Office of National Statistics longitudinal depth was not as good as the Australian Bureau of Statistics in breaking down full-time and part-time employment pre 1992 there was some very good data not readily available in legacy ABS data captures, especially in areas like the self-employed.
Although I could only get data as far back as 1992 the picture it tells is as interesting as the Australian story (with data going back as far as 1978).
Here are the analytics.
Figure 1: UK Full-Time and Part-Time Employment (Mar – May 1992 to Oct-Dec 2012). Source: ONS.
Like the Australian example, the first graph highlights the almost identical increase in contingent (part-time) and full-time employment over the past decade. Since early 1992 full-time employment has increased by 10.3% (2.021-million) while part-time employment increased by 34.5% (2.072-million).
Figure 2: Increases in UK Full-Time and Part-Time Employment (Mar-May 1992 to Oct-Dec 2012). Source: ONS.
Like the Australian example the increases in both full and part-time employment are identical. Unlike the Australian example which has not seen a downturn since 1991/92 the UK data shows a massive 1-million full-time jobs disappearing post GFC but over the past 12-months or so that has improved by around 400,000 new positions. Additionally, the start of this data series showed negative full-time employment through to early 1994 as the UK struggled out of the late 1980’s and early 1990’s downturns (oh, how I wish I had the data going back to 1987).
Figure 3: Overall UK Employment versus Working Age Labour Force (Mar-May 1992 to Oct-Dec 2012). Source: ONS.
Here’s a look at the differential between total employment creation and the UK defined, economically inactive numbers. The UK created an additional 4.093-million new jobs; from 25.635-million in early 1992 to a record 29.729-million jobs at the end of 2012 (the pre-GFC high was 29.572-million in Mar-May 2008). The UK has steadily increased its working age population since 1992 (due to a combination a slightly lower than replacement fertility rate plus a higher immigration to migration ratio) which has left it with 3,734,000-million less jobs than that required to employ the 7.828-million increase in the working age labour force.
A quick point on the above. Like my previous article on this subject (avoiding wonkish angst) it should be noted that my Working Age Labour Force number in this graphic has been worked out utilising the ONS economically active rate data rather than my preferred method of using actual population statistics (you can see an example of this in my 2012 Abbott’s Promise piece).
In conclusion looking at the UK ‘employment type’ data is further confirmation of a global trend toward greater reliance on part-time employment, which on one hand is increasing employment to record levels while at the same time decreasing the amount of work available.
Has the UK reached peak employment yet? I’m not convinced it has but the more I look at the global data the more I am convinced we are reaching that point in the next decade. As I stated in my initial Australian analysis:
With an increasing working age population and a growing gap between jobs available the future is looking anything but certain, especially with the rise of labour augmentation and robotics replacing jobs quicker than they can be created.