Economy

Claim: The labour market in Wales is performing worse than the UK

Labour Force Survey (LFS) estimates published by the Office for National Statistics (ONS) show that, since the pandemic, although the unemployment rate in Wales has generally remained below the UK rate, Wales has also generally had lower employment and higher economic inactivity than in the UK, with the gap between the two countries for these measures fluctuating over this time.

However, these figures are particularly volatile for Wales and provide an uncertain view of the labour market when viewed in isolation.

The current headline labour market statistics, which look at rates of employment, unemployment and economic inactivity, are classified by ONS themselves as ‘official statistics in development.’

The ONS also confirms that they are facing challenges in maintaining response rates to the LFS, affecting the reliability of its data.

The best way of understanding the performance of the Welsh labour market is to consider longer term trends across a basket of indicators including other data sources such as the Annual Population Survey, HMRC real time information on paid employees, data on workforce jobs, and the claimant count.

Evidence from these data sources suggests that the labour market in Wales has followed similar trends to the UK as a whole since the pandemic.

Further information on the challenges, updates and current badging of the LFS are available in a Chief Statistician’s update on the labour market estimates for Wales.