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GDP and the Labour Market, Q2 2011 - August Labour Market Update

Released: 17 August 2011 Download PDF

Employment and GDP growth

Q2 2011, UK

Employment and GDP growth

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The labour market weakened in 2011 Q2 with the unemployment rate rising.

The employment level increased by 25,000 in 2011 q2, while the employment rate was unchanged from 2011 Q1 at 70.7 per cent. Compared to the same quarter last year the employment rate has risen 0.2 percentage points with 251,000 more people in employment.

The increase in total employment this quarter was driven by an increase of 49.000 in full time employment. The number of people in full time employment stands at 21.35 million in 2011 Q2. This compares to a reduction in part time employment of 24,000 bringing the total number of those working part time to 7.92 million.

Self employment increased by 24,000 and employees increased by 36,000 in 2011 Q2. These increases were partly offset by declines in government supported trainess and unpaid family workers, resulting in the rise in employment of 25,000.

Unemployment has increased by 38,000 quarter-on-quarter with the unemployment rate rising on the quarter to 7.9 per cent but virtually unchanged compared to 2010 Q2.

The claimant count rose 37,000 in July 2011 taking the total number claiming to 1.56 million, approximately 100,000 higher than July 2010.

In Q2 2011, vacancies fell 25,000 to 458,000. Vacancies are 26,000 lower than 2010 Q2.

GDP growth

Q2 2011, UK

GDP growth comparing recessions

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UK output increases by 0.2 per cent.

According to the latest figures, UK GDP increased by 0.2 per cent in quarter two 2011.

This indicates that the economy is growing but at a modest pace. The economy has now recovered just over 40 per cent of the output lost through the recession and has expanded by 2.7 per cent since the recession ended compared to a loss to output of 6.4 per cent during the recession. Compared to the 1980s recession, which is most similar to this recession in terms of the speed and depth of the drop in output, this recovery seems to be more moderate.

In the second quarter, GDP growth was driven by the service sector, at 0.5 per cent, and in particular the business services sector (0.7 per cent). But this was offset by negative growth in the production sector of 1.3 per cent. Output in the mining and quarrying and utilities sectors fell by 6.5 per cent and 2.7 per cent respectively, with a smaller fall in manufacturing output of 0.3 per cent. The construction sector grew but at a very modest pace of 0.5 per cent. However, this marks a turnaround from the negative growth of the previous two quarters, which cumulatively reduced construction output by 5.4 per cent.

Source: Office for National Statistics

Background notes

  1. Sources:

    Gross Domestic Product (ABMI): chained volume measures, seasonally adjusted, Office for National Statistics.

    Total employment level (MGRZ), self-employment level (MGRQ), full time employment level (YCBE), part-time employment level (YCBH): Labour Force Survey, all those aged 16 and over, seasonally adjusted, Office for National Statistics.

  2. Notes:

    Most recent Labour Market estimates are available from the Labour Market Statistical Bulletin published on 17 August 2011.

    GDP estimate for quarter two from Gross Domestic Product: Preliminary Estimate – Q2 2011 published on 26 July 2011.

    The first quarters of recession used for this analysis are quarter three 1979 for 1979-81 recession, quarter three 1990 for 1990-91 recession and quarter two 2008 for 2008-09 recession.

  3. Details of the policy governing the release of new data are available by visiting www.statisticsauthority.gov.uk/assessment/code-of-practice/index.html or from the Media Relations Office email: media.relations@ons.gsi.gov.uk

Content from the Office for National Statistics.
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