About economic inactivity

The UK labour market comprises of three main groups: the employed, the unemployed and the economically inactive. This latter group consists of those people who are out of work but who do not satisfy all of the International Labour Organisation (ILO) criteria for unemployment. This is because they are either not seeking work or are unavailable to start work.

Economic inactivity lies on the supply side of the labour market framework, as economically-inactive people have the potential to move into the labour market at some point in the future.

Information on inactivity is important for a number of reasons. Over recent years, there has been increasing recognition of the need for macroeconomic analysis to consider the size and composition of the inactive group. This analysis is used in assessing potential labour supply. In addition, there has been a greater policy focus on the scope for reducing inactivity, as well as unemployment, as a means of boosting economic performance.

Broadly speaking, the inactive group can be divided into those who want a job and those who do not. While this is not an exact reflection of whether people will move into economic activity in the near future, it does give some indication of the strength of people's labour market attachment.

Official figures on inactivity are based on the results of the Labour Force Survey (LFS). In addition to the numbers and rates of people who are inactive, the LFS collects information on their reasons for inactivity. It is also possible to look at the characteristics of the inactive group by combinations of the criteria of wanting work, seeking work and availability for work. New questions are being devised which better measure a respondent's attachment to the labour market.

The Office for National Statistics (ONS) publishes monthly statistics on economic inactivity by age and reason in the labour market statistics First Release and in the Economic and Labour Market Review.