Public sector employment falls to 16-year low

11 Jun 14
The number of people working in the public sector has fallen to its lowest level in 16 years after the part-privatisation of Lloyds Banking Group led to nearly 100,000 posts being reclassified in the first quarter of this year.

By Richard Johnstone | 11 June 2014

The number of people working in the public sector has fallen to its lowest level in 16 years after the part-privatisation of Lloyds Banking Group led to nearly 100,000 posts being reclassified in the first quarter of this year.

Latest figures for the public sector workforce published today by the Office for National Statistics showed that, in the three months to the end of March, 5.4 million people were working in the public sector, down 103,000 posts over the quarter. This is the lowest figure since comparable records began in March 1999, according to today’s Labour market statistics report.

Excluding the effects of the reclassification of Lloyds, following the sell-off of a second tranche of shares, public sector employment fell by 11,000 over the quarter.

The biggest fall was in the civil service, where there was a reduction of 6,000 posts to 439,000. However, the number of people employed in the NHS increased by around 10,000 people to 1.58 million. Just over 1.52 million people were employed in education, around 2,000 lower than the previous month.

Figures for overall employment for the three months from February to April, also published today by the ONS, revealed there was an increase of 345,000 people in work over the period.

In total, there were 2.16 million people out of work, 161,000 fewer than for November 2013 to January 2014 and 347,000 fewer than a year earlier. This equates to 6.6% of the economically active population, down from 7.2% in the three months before.

Employment minister Esther McVey highlighted the number of people in work was now above 30.5 million for the first time following the biggest ever quarterly rise in employment.

‘As we build a stronger economy, businesses up and down the country are feeling increasingly confident about creating jobs, meaning many thousands more people are in work every day – ensuring a better future for them, their families, and for the country as a whole.’

Responding to the figures, the Centre for Economics and Business Research said that the fall in UK unemployment meant the level was down to the lowest level since the fourth quarter of 2008.

CEBR senior economist Rob Harbron added the labour market was also moving back towards full-time employment, after part-time work became more prevalent following the 2008/09 downturn. The number of workers on full-time contracts rose by 678,000 year on year, compared to an increase of 102,000 part-time workers, he highlighted.

‘In addition, the share of those working part-time only because they cannot find a job with longer hours has now fallen to 17.5%,’ Harbron added.

‘A lower rate of so-called underemployment has not been seen since the fourth quarter of 2011, although this still remains well above lows of close to 7% seen in the mid 2000s.’

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