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27 May 2022

UK suffers highest fall in employment rate in the G7

Lower EU migration and higher rates of long-term illness have reduced employment levels in Britain.

By Polly Bindman

The UK’s employment rate has fallen by more than any other G7 country, according to the latest data from the Organisation for Economic Co-operation and Development (OECD).

Following a general increase since early 2012, the UK employment rate declined at the start of the pandemic, according to the Office for National Statistics and the OECD. Unlike EU countries, however, where the average employment rate went up by 1.3 percentage points, from 68 per cent to 69.3 per cent, between the last quarter of 2019 and the first of 2022, the UK hasn’t managed to recover at such a pace. 

Sitting at 75.7 per cent, the UK’s employment rate is 0.1 percentage points higher than the previous quarter, but it remains 0.8 percentage points lower than before the pandemic.

While it isn’t entirely clear what’s behind the UK’s failure to catch up, Tony Wilson, director of the Institute for Employment Studies, speculates that Brexit (which has dramatically reduced EU migration), a lack of access to support, and a furlough scheme that offered no obligations to retrain staff, could all have parts to play. Others have cited a rise in long-term illness following the pandemic and an increase in student numbers.

[See also: Does your salary mean you’re rich? And what makes you upper, middle or working class? We ask the British public]

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