What assessment has the Minister made of the latest labour market statistics for Wales, covering October 2023, that revealed economic inactivity levels increased to 23.8 per cent, compared to a UK average of 20.9 per cent ?
Care should be taken over interpreting the Labour Market Statistics at present, especially those obtained through survey data. The Chief Statistician has provided an account of these issues, which is available at the following link:
Real Time Information (RTI) employee data is the most timely measure on the labour market which is not based on survey data. On the latest month’s data, Wales has performed similar to the UK, as it has over the medium term, with payrolled employees down by 0.1% on the month before (UK was also slightly down but 0% when rounded).
As across the wider UK, economic inactivity in Wales is above pre-pandemic levels. There has been a big increase in people who are inactive because they are too ill to work compared with pre-pandemic position. This result has persisted over recent quarters and is observed at both Welsh and UK levels. Rising inactivity owing to ill-health is not confined to older working-age people, even though older people account for most of the increase. There has been a substantial rise in inactivity among younger workers too, many with mental health issues.
The performance of the labour market in Wales compares well with the rest of the UK on an historical basis. As noted in previous Chief Economist reports, recent performance contrasts with the period before devolution, when the employment rate in Wales was typically five to six percentage points lower than the UK (reflecting a much higher level of economic inactivity in Wales).
All of these changes are happening during a period when the economy UK-wide is suffering from the effects of the cost-of-living crisis and tightening monetary policy. Despite these, the labour market in Wales has remained relatively resilient but we remain focussed on providing support to those furtherst from the labour as set out in our plan for Employability and Skills available here Stronger, fairer, greener Wales: a plan for employability and skills: summary [HTML] | GOV.WALES.