The Scottish Parliament and Scottish Parliament Infor mation C entre l ogos .

Financial Scrutiny Unit Briefing

Labour Market update: November 2016

17 November 2016

16/90

Andrew Aiton

This is a briefing on the Office for National Statistics' November 2016 Regional Labour Market release for Scotland.

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CONTENTS

SCOTTISH LABOUR MARKET DASHBOARD: MAY-JUL 2016 ............................................................................... 3

OVERVIEW OF THIS QUARTER’S STATISTICS: MAY-JUL 2016 ........................................................................... 3

LABOUR FORCE SURVEY ......................................................................................................................................... 4

UNEMPLOYMENT ................................................................................................................................................... 4 EMPLOYMENT ........................................................................................................................................................ 5 ECONOMIC INACTIVITY ......................................................................................................................................... 6

CLAIMANT COUNT ..................................................................................................................................................... 8

CONSTITUENCY DATA: EMPLOYMENT ................................................................................................................... 8

GUEST INDICATOR: EU NATIONALS IN SCOTLAND ........................................................................................... 13

EU NATIONALS IN EMPLOYMENT ...................................................................................................................... 13 UNEMPLOYED EU NATIONALS ........................................................................................................................... 14

SOURCES .................................................................................................................................................................. 16

RELATED BRIEFINGS .............................................................................................................................................. 18

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SCOTTISH LABOUR MARKET DASHBOARD: MAY-JUL 2016

Overall Men Women

Rate (%)

Change on prev Qtr (%

points)

Rate (%)

Change on prev Qtr (%

points)

Rate (%)

Change on prev Qtr (%

points)

4.7% 5.2% 4.3%

-0.4 -0.6 -0.3

73.6% 77.0% 70.3%

-0.5 -0.6 -0.5

22.6% 18.6% 26.5%

+0.9 +1.1 +0.8

Rate (%)

Change on prev Month (% points)

2.4%

0.0

OVERVIEW OF THIS QUARTER’S STATISTICS: MAY-JUL 2016

While Scotland saw a decrease in unemployment it also saw a decrease in employment. Over the year Scotland has seen the biggest decrease in the number of economically active people, those in employment or looking for employment, since 1993. Despite this there are 40,000 more people in employment now than at the pre-recession peak (March-May 2008). (Scottish Government)

Employment levels for women and those aged 16-24 are higher than in the UK. (Scottish Government)

Unemployment

Employment

Economic

Inactivity

Claimant

Count

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LABOUR FORCE SURVEY

The Labour Force Survey (LFS) records the official unemployment rate along with a wide variety of other labour market statistics. It surveys a sample group of 60,000 households throughout the UK, including around 6,000 in Scotland. LFS figures for the whole population are estimates based on this sample.

UNEMPLOYMENT

International Labour Organisation’s definition

Level: Any individual aged 16 and over without a job who has been actively seeking work within the last four weeks and is available to start work within the next two weeks

Rate: Number of unemployed individuals as a proportion of the total number of economically active people, which includes both the unemployed and those in work.

Scotland and UK comparison

The number of unemployed people in Scotland fell by 13,000 over the quarter to the lowest level it has been since Jul-Sep 2008 (127,000).

The unemployment rate in Scotland is the lowest it has been since Jul-Sep 2008 (4.7%).

The unemployment rate in the UK is the lowest since Jul to Sep 2005. (ONS 2016a)

Table 1 Unemployment (16+)

Seasonally Adjusted

Level (thousands)

Quarter change (thousands)

Year change (thousands)

Rate Quarter change (% points)

Year change (% points)

Scotland 129 -14 -38 4.7% -0.4 -1.3

UK 1,604 -37 -146 4.8% -0.1 -0.5

Unemployment by Gender

Over the quarter in Scotland, the fall in the unemployment level was mainly due to a decrease of 10,000 unemployed men.

The unemployment rate for men is the lowest it has been since 2008 (Jul-Sep 2008 5.1%).

The unemployment rate for men in Scotland is higher than for men in the UK as a whole, while the rate for women is lower.

Table 2 Unemployment by Gender (16+ )

Seasonally Adjusted

Level (thousands)

Quarter change (thousands)

Year change (thousands)

Rate

Quarter change (% points)

Year change (% points)

Scotland Men 73 -10 -19 5.2% -0.6 -1.3

Women 56 -4 -19 4.3% -0.3 -1.3

UK Men 876 -15 -82 4.9% -0.1 -0.5

Women 728 -22 -54 4.7% -0.1 -0.5

Unemployment

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Unemployment by Age

The unemployment rate for 16-24 year-olds in Scotland has decreased by 2.8 percentage points over the year, and is now the lowest since records began in 2002.

The current unemployment rate for 25-34 year olds is the lowest since records began in 2002.

Table 3 Unemployment rates by age

Not Seasonally Adjusted

16- 24 25 - 34 35 - 49 50 - 64

Rate Year

change (% points)

Rate Year

change (% points)

Rate Year

change (% points)

Rate Year

change (% points)

Scotland1 12.0% -2.8 4.1% -2.2 3.4% -0.7 4.6% +0.1

UK 14.3% -1.0 4.5% -0.5 3.3% -0.4 3.3% -0.2

EMPLOYMENT

International Labour Organisation’s definition

Level: Any individual aged 16 and over who is undertaking one hour or more a week of paid work Rate: Number of people in employment expressed as a percentage of all people aged 16-64

Scotland and UK comparison

The number of people aged 16 and over in employment in Scotland fell by 25,000 over the quarter.

The employment rate in Scotland fell by 0.5 percentage point from the previous quarter and 0.6 over the year.

The UK employment rate is the joint highest since comparable records began in 1971 (ONS 2015a).

Table 4 Employment (Level 16+, rate 16-64)

Seasonally Adjusted

Level

(thousands)

Quarter change

(thousands)

Year change (thousands)

Rate Quarter change

(% points)

Year change (% points)

Scotland 2,604 -25 -12 73.6% -0.5 -0.6

UK 31,799 +49 +461 74.5% 0.0 +0.7

Employment by Gender

Employment levels and rates are higher for men than for women at both Scottish and UK levels.

In Scotland the decrease in the level of employment over the year was driven by 15,000 men leaving employment, compared to 10,000 men finding work.

In the UK the increase in employment mainly came from women entering employment.

1 The statistics on unemployment by age in Scotland are not of sufficient quality to be published by the ONS as

National Statistics and are published as experimental statistics

16+16-64

Employment

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Table 5 Employment by Gender (Level 16+, rate 16-64) Seasonally Adjusted

Level (thousands)

Quarter change (thousands)

Year change (thousands)

Rate

Quarter change (% points)

Year change (% points)

Scotland Men 1,339 -15 +2 77.0% -0.6 -0.3

Women 1,265 -10 -13 70.3% -0.5 -0.9

UK Men 16,917 +2 +242 79.2% -0.1 +0.6

Women 14,882 +47 +219 69.8% +0.1 +0.8

Employment by Age

The employment rate for 16-24 year-olds in Scotland has fallen by 3.1 percentage points over the year and is the lowest since 2010. (Jul-Sep 2010 57.8%).

Table 6 Employment rates by age

Not Seasonally Adjusted

16- 24 25 – 34 35 - 49 50 - 64

Rate Year

change (% points)

Rate Year

change (% points)

Rate Year

change (% points)

Rate Year

change (% points)

Scotland2 60.0% -3.1 80.7% -0.9 82.2% +0.7 68.4% -0.3

UK 55.9% -0.3 82.0% +0.7 83.8% +0.7 70.8% +1.1

ECONOMIC INACTIVITY

International Labour Organisation’s definition

Level: Any individual aged 16 to 64 who is not in employment, has not looked for work in the last four weeks, and is unable to start work within the next two weeks.

Rate: Number of people economically inactive expressed as a percentage of all people aged 16-64.

Scotland and UK comparison

The number of people economically inactive in Scotland increased by 31,000 over the quarter, and by 54,000 over the year.

Over the quarter the economic inactivity rate increased in Scotland at a higher rate than the UK as a whole.

Over the year, Scotland saw the biggest increase in the economic inactivity rate of any part of the UK. See figure 1.

The economic inactivity rate in Scotland is higher than in the UK.

2 The statistics on employment in Scotland by age are not of sufficient quality to be published by the ONS as

National Statistics and are published as experimental statistics

16+16-64

Economic

Inactivity

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Figure 1: Annual change in economic activity rate between Jul-Sep 2015 and Jul-Sep 2016 (%pts)

Table 7 Inactivity (16-64)

Seasonally Adjusted

Level (thousands)

Quarter change (thousands)

Year change (thousands)

Rate Quarter change (% points)

Year change (% points)

Scotland 773 +31 +54 22.6% +0.9 +1.6

UK 8,893 +49 -103 21.7% +0.1 -0.3

Economic Inactivity by Gender

Economic inactivity rates are higher for women than for men.

The increase in economic inactivity across the quarter mainly came from an extra 18,000 men becoming economically inactive.

The Scottish economic inactivity rate for men is higher than the UK while the rate for women in Scotland is lower than the UK.

Table 8 Economic Inactivity by Gender (16-64) Seasonally Adjusted

Level (thousands)

Quarter change (thousands)

Year change (thousands)

Rate

Quarter change (% points)

Year change (% points)

Scotland Men 310 +18 +21 18.6% +1.1 +1.3

Women 463 +14 +33 26.5% +0.8 +1.9

UK Men 3,367 +48 -29 16.5% +0.2 -0.2

Women 5,526 0 -74 26.8% 0.0 -0.4

-2.5-2.0-1.5-1.0-0.50.00.51.01.52.0

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CLAIMANT COUNT

The Claimant Count figures presented here are the experimental statistics from the ONS for Jobseekers Allowance, plus Universal Credit claimants who are out of work.

This is not an official measure of unemployment, but it does provide accurate information on the labour market at a local level.

Scotland and UK comparison – (including out of work Universal Credit claimants)

The seasonally adjusted claimant count rate for October in Scotland and the UK as a whole was unchanged from September.

The Scottish claimant count rate is higher than the UK rate.

Table 9 Claimant Count, September 2016 (including out of work Universal Credit claimants) (16-64)

Seasonally Adjusted

Level Month change Year change Rate Month change

(% points)

Year change (% points)

Scotland 83,100 +700 +4,100 2.4% 0.0 +0.1

UK 803,300 +9,900 +10,000 1.9% 0.0 0.0

*Data rounded to nearest 100

CONSTITUENCY DATA: EMPLOYMENT

Constituency data for Scotland comes from the Annual Population Survey (APS). The APS datasets are produced quarterly, with each dataset containing 12 months of data. The latest APS data covers Jul 2015-Jun 2016. This month focuses on employment by constituency. Shetland has the highest employment rate at 89.4% while Glasgow Maryhill and Springburn has the lowest at 54.5%. Glasgow Provan saw the biggest increase over the year, while Edinburgh Southern saw the largest decrease.

Claimant

Count

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Table 10: Unemployment by Parliamentary Constituency

Jul 2015-Jun 2016 Annual Change

Level Rate (%)

Rank (1=highest

Rate) Level

Rate (%

points)

Aberdeen Central 52,600 75.2 30 3,900 0.1

Aberdeen Donside 35,100 80.1 6 -9,300 1.0

Aberdeen South and North Kincardine

43,200 76.8 19 6,900 -1.4

Aberdeenshire East 47,400 84.4 3 1,000 2.2

Aberdeenshire West 40,300 78.6 12 -3,400 -4.2

Airdrie and Shotts 33,600 78.0 14 1,600 8.5

Almond Valley 37,400 73.6 38 -2,500 0.0

Angus North and Mearns 44,300 79.7 7 11,900 6.4

Angus South 29,400 72.7 44 -1,600 -0.3

Argyll and Bute 24,100 76.0 22 0 -1.0

Ayr 32,700 75.4 29 1,700 4.2

Banffshire and Buchan Coast

22,000 69.5 55 -7,300 -7.5

Caithness, Sutherland and Ross

29,200 73.8 37 1,300 -0.4

Carrick, Cumnock and Doon Valley

32,000 66.7 63 -2,500 -3.7

Clackmannanshire and Dunblane

29,000 70.0 54 800 -0.7

Clydebank and Milngavie 31,600 76.2 21 -1,700 6.5

Clydesdale 39,700 77.6 15 1,500 2.9

Coatbridge and Chryston 37,600 73.4 41 7,100 1.6

Cowdenbeath 36,700 80.5 5 -3,500 1.7

Cumbernauld and Kilsyth 30,000 75.6 26 200 6.1

Cunninghame North 27,200 68.8 58 400 4.7

Cunninghame South 27,000 62.7 70 -1,500 -4.4

Dumbarton 38,400 74.3 34 3,500 2.9

Dumfriesshire 36,600 75.1 31 1,700 0.0

Dundee City East 31,400 63.2 68 1,100 -4.1

Dundee City West 30,100 63.9 67 -1,400 2.6

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Jul 2015-Jun 2016 Annual Change

Level Rate (%)

Rank (1=highest

Rate) Level

Rate (%

points)

Dunfermline 35,400 74.7 32 -2,500 -3.5

East Kilbride 32,100 76.0 22 -2,400 0.7

East Lothian 34,200 74.4 33 -1,800 -1.5

Eastwood 34,200 78.8 10 2,200 3.1

Edinburgh Central 39,600 72.3 48 -1,000 6.9

Edinburgh Eastern 40,300 67.9 62 1,000 -9.9

Edinburgh Northern and Leith

47,000 77.0 18 -500 -0.3

Edinburgh Pentlands 27,300 72.6 46 -6,300 1.2

Edinburgh Southern 42,300 64.3 66 -2,400 -9.9

Edinburgh Western 42,000 71.9 51 -600 -6.6

Ettrick, Roxburgh and Berwickshire

30,400 73.6 38 -2,200 -3.6

Falkirk East 40,400 77.5 16 1,700 4.3

Falkirk West 36,000 76.5 20 1,500 5.0

Galloway and West Dumfries

30,000 74.0 35 -700 2.3

Glasgow Anniesland 27,200 61.0 71 -4,400 -1.2

Glasgow Cathcart 55,200 72.9 43 11,100 1.2

Glasgow Kelvin 33,100 65.4 64 -5,800 -8.1

Glasgow Maryhill and Springburn

23,800 54.5 73 2,500 -6.9

Glasgow Pollok 37,800 64.4 65 -9,300 -1.1

Glasgow Provan 37,400 75.6 26 10,200 14.8

Glasgow Shettleston 22,400 58.0 72 -2,100 -7.1

Glasgow Southside 34,400 68.1 60 5,000 14.3

Greenock and Inverclyde 31,600 68.4 59 -300 0.6

Hamilton, Larkhall and Stonehouse

34,800 73.0 42 -2,500 -3.8

Inverness and Nairn 49,700 78.9 9 -3,800 -2.4

Kilmarnock and Irvine Valley

36,300 69.3 56 -300 -2.5

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Jul 2015-Jun 2016 Annual Change

Level Rate (%)

Rank (1=highest

Rate) Level

Rate (%

points)

Kirkcaldy 29,700 69.2 57 -3,500 -4.4

Linlithgow 48,400 75.6 26 3,600 0.9

Mid Fife and Glenrothes 27,900 62.8 69 800 -3.3

Midlothian North and Musselburgh

38,600 73.6 38 0 -0.4

Midlothian South, Tweeddale and Lauderdale

34,100 77.4 17 1,400 1.7

Moray 35,700 72.2 49 -1,500 -1.4

Motherwell and Wishaw 30,300 68.1 60 -2,900 -6.6

Na h-Eileanan an Iar 12,700 79.2 8 900 4.5

North East Fife 34,900 70.5 53 5,300 -1.8

Orkney Islands 11,300 87.6 2 200 1.3

Paisley 31,700 72.6 46 -4,900 -0.9

Perthshire North 33,400 78.8 10 -200 2.7

Perthshire South and Kinrossshire

37,000 78.3 13 800 -0.5

Renfrewshire North and West

31,000 76.0 22 -900 0.8

Renfrewshire South 31,800 73.9 36 3,700 -1.1

Rutherglen 36,000 72.2 49 2,800 -0.9

Shetland Islands 12,800 89.4 1 1,200 8.5

Skye, Lochaber and Badenoch

31,700 81.5 4 -200 -0.6

Stirling 34,200 72.7 44 -2,000 -0.7

Strathkelvin and Bearsden

34,700 71.5 52 1,300 -1.4

Uddingston and Bellshill 37,600 76.0 22 -1,600 4.6

Scotland 2,489,200 72.9 600 0.0

Source: nomis

Please note

Some data is unavailable as the area samples size is too small to provide reliable estimates.

These estimates have quite large sampling variability which is more likely to affect level rather than rates.

Change in the estimates can be as a result of changes in the estimated population within an area.

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Figure 2: Constituency data map

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GUEST INDICATOR: EU NATIONALS IN SCOTLAND

SPICe recently published a briefing on EU nationals living in Scotland which presents analysis of the characteristics of EU nationals living in Scotland, based on the 2015 Annual Population Survey.

Throughout this section, the following definitions are used:

EU27: all EU member states excluding the UK

EU14: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain and Sweden

Accession: Croatia, Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovak Republic, Slovenia, Romania and Bulgaria2

EU NATIONALS IN EMPLOYMENT

73.1% of the Scottish population aged 16-64 are in employment. Overall, EU nationals have a higher employment rate (78.9%). However, the picture is very different within this group: EU14 nationals have a much lower employment rate (68.0%), while those from accession countries have a much higher employment rate (84.9%). Non-EU nationals have the lowest employment rate of all the groups shown.

Figure 3: Employment rate by nationality (population aged 16-64), Scotland 2015

Source: SPICe analysis of APS Jan-Dec 2015, ONS

There are an estimated 115,000 EU nationals in employment in Scotland, representing 4% of the Scottish workforce in employment. Around a third (36,000) of these are from EU14 countries, with the remaining two-thirds (79,000) from accession countries.

Almost a third of EU nationals in employment in Scotland (33,000) are working in the distribution, hotels and restaurant sector. Figure 10 shows a breakdown by industrial sector of EU nationals in employment. The agriculture, forestry and fishing sector is not shown as the estimate is too small to be considered statistically robust. In addition, the seasonal and often casual nature of work in this sector may not be well reflected in the APS.

78.9%68.0%

84.9%

54.5%

73.1%

EU EU14 Accession Non-EU Total

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Figure 4: Employment of EU nationals by industry, Scotland 2015

0 10,000 20,000 30,000 40,000

Energy and water

Construction

Other services

Transport and communication

Manufacturing

Banking and finance

Public admin, education and health

Distribution, hotels and restaurants

Source: SPICe analysis of APS Jan-Dec 2015, ONS

For the larger sectors, it is possible to provide a further split between EU14 and accession countries and this is shown in Figure 11. However, this is not possible for all sectors due to the sample sizes involved and the reliability of smaller estimates.

Figure 5: Employment of EU nationals in selected industries, Scotland 2015 (000s)

Source: SPICe analysis of APS Jan-Dec 2015, ONS

UNEMPLOYED EU NATIONALS

The unemployment rate expresses the number unemployed as a percentage of the economically active population.3 Figure 9 shows unemployment rates for those of working age.4 EU nationals have an unemployment rate of 5.8% which is in line with the Scottish average of 5.9%. Non-EU nationals have a much higher unemployment rate (11.4%). Due to small sample

3 Economically active refers to those who are either in work, or out of work but actively seeking and available for

work 4 Throughout this briefing, the term ‘working age’ refers to those aged 16-64

610

6

27

913

0

5

10

15

20

25

30

35

Distribution, hotelsand restaurants

Public admin,education and health

Banking and finance

Accession

EU14

15

sizes, it is not possible to provide reliable unemployment rate estimates for groups within the EU total.

Figure 6: Unemployment rate by nationality (population aged 16-64), Scotland 2015

Source: SPICe analysis of APS Jan-Dec 2015, ONS

5.8%

11.4%

5.9%

EU Non-EU Total

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SOURCES

Hudson, N. and Aiton, A (2016) EU nationals living in Scotland. Available at: http://www.scottish.parliament.uk/parliamentarybusiness/101937.aspx [Accessed 15 November 2016] Nomis, Claimant count, [Online]. Available at: https://www.nomisweb.co.uk/articles/894.aspx Accessed 16 November 2016] Office for National Statistics. (2016a) UK labour market: Nov 2016, [Online]. Available at: https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/uklabourmarket/november2016 [Accessed 16 November 2016] Office for National Statistics. (2016b) Regional labour market statistics in the UK: Nov 2016 [Online]. Available at: https://www.ons.gov.uk/releases/regionallabourmarketstatisticsintheuknov2016 Accessed 16 November 2016] Scottish Government, Unemployment falls, Available at: http://news.gov.scot/news/unemployment-falls-1 [Accessed 16 November 2016]

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THIS PAGE IS INTENTIONALLY BLANK

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RELATED BRIEFINGS

SB 16-73 Labour Market Update: September 2016

SB 13-80 Labour Market Statistics

Scottish Parliament Information Centre (SPICe) Briefings are compiled for the benefit of the Members of the Parliament and their personal staff. Authors are available to discuss the contents of these papers with MSPs and their staff who should contact Andrew Aiton on extension 85188 or email andrew.aiton@parliament.scot. Members of the public or external organisations may comment on this briefing by emailing us at spice@parliament.scot. However, researchers are unable to enter into personal discussion in relation to SPICe Briefing Papers. If you have any general questions about the work of the Parliament you can email the Parliament’s Public Information Service at sp.info@parliament.scot.

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