Economically inactive people are not in work and do not meet the internationally agreed definition of unemployment. They are people without a job who have not actively sought work in the last four weeks and/or are not available to start work in the next two weeks.
Publications
Statistics on Economic Inactivity includes for Wales and the UK. Annual data at Welsh local authority level.
Labour Market Statistics for Northern Ireland (employment, unemployment).
Labour Market Statistics for Northern Ireland (employment, unemployment).
Labour Market Statistics for Northern Ireland (employment, unemployment, earnings).
Statistics on women in Northern Ireland, labour market, childcare provision, earnings.
Overview
The number of economically inactive people in the UK is measured by the Labour Force Survey (LFS) and consists of people aged 16 and over without a job who have not sought work in the last four weeks and/or are not available to start work in the next two weeks. There are many reasons why people without work may be economically inactive. For example, some people are unable to work due to long-term illness.
Inactivity levels and rates are published each month in the Labour Market Statistics First Releases. Estimates are available by sex, by age and by reason for inactivity. Inactivity levels measure the total number of people estimated to be economically inactive while inactivity rates allow changes in the labour market to be interpreted in a wider context by allowing for changes in the population.
The headline measure of inactivity is the working-age inactivity rate (based on the male population aged 16 to 64 and the female population aged 16 to 59) which takes account of state pension ages.
Estimates of inactivity are also available for Government Office Regions (GORs) and at local area level. Regional estimates of total inactivity are measured by the Labour Force Survey (LFS) while more disaggregated regional inactivity estimates and local area estimates are measured by the Annual Population Survey (APS).
Estimates of total and working-age inactivity levels and rates for the UK are available from 1971. Most other inactivity estimates are available from 1993.
Technical Data
Labour Force Survey
The Labour Force Survey (LFS) is the largest regular household survey in the UK. The survey covers people resident in private households, National Health Service (NHS) accommodation and student halls of residence. It does not cover any other communal establishments. LFS interviews are conducted continuously throughout the year.
In any three-month period, a nationally representative sample of approximately 120,000 people aged 16 and over in around 53,000 households is interviewed. Each household is interviewed five times, at three monthly intervals.
The initial interview is conducted face-to-face by an interviewer visiting the address, except for residences north of the Caledonian Canal in Scotland (where face-to-face-interviews would be prohibitively expensive). The other interviews are conducted by telephone wherever possible. The survey asks a series of questions about respondents’ personal circumstances and their labour market activity.
The survey is conducted in five ‘waves’ so that in any one quarter, one wave will be receiving their first interview, one wave their second, and so on, with one wave receiving their fifth and final interview. Therefore, there is an 80 per cent overlap in the samples for each successive quarter.
Seasonal adjustment
Seasonal movements can occur in labour market data for a number of reasons including holidays and recruitment patterns. For example, a large number of people leave full-time education and enter the labour market in the summer.
To make it easier to identify the underlying movements in the labour market, changes due solely to seasonal influences are removed from many series. This process is known as seasonal adjustment. LFS estimates are seasonally adjusted using the X-12 ARIMA package developed by Statistics Canada. The seasonal adjustment of LFS data is usually reviewed annually.
Sampling Variability
Survey estimates are prone to sampling variability. The easiest way to explain this is by example. In the April to June 2008 period, there were estimated to be 7,876,000 economically inactive people of working age in the UK, according to the LFS (seasonally adjusted). These figures were published in August 2008.
If we drew another sample for the same period we could get a different result, which could be higher or lower. In theory, we could draw many samples, and each would give a different result. The spread of these results leads to sampling variability.
Once we know the sampling variability we can calculate a range of values about the sample estimate that represents the expected variation with a given level of assurance. This is called a confidence interval. For a 95 per cent confidence interval we expect that, in 95 per cent of the samples, the confidence interval will contain the true value of inactivity that would have been obtained by surveying the entire population. For example, for April to June 2008, we can be 95 per cent confident that the true level of inactivity was within 123,000 of the estimate of 7,876,000 (that is, within the range 7,753,000 to 7,999,000).
Sampling variability also affects changes over time. Changes in inactivity between three-month periods are rarely greater than the level that is explainable by sampling variability. It is estimated that the number of inactive people of working age in the UK fell by 3,000 between January to March 2008 and April to June 2008 (seasonally adjusted). We can be 95 per cent confident that the true change lies in the range between a decrease of 90,000 and an increase of 84,000. It is more likely that inactivity decreased, rather than increased.
In general, the larger the number of people in the sample, the smaller the variation between estimates. Estimates based on the LFS for the whole of the UK are therefore more accurate than those for smaller geographical areas. Indications of sampling variability for national and regional LFS data are given in the Labour Market Statistics First Releases.
Glossary
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Annual Population Survey (APS)
The Annual Population Survey is similar to the Labour Force Survey (LFS). It started in January 2004 and is compiled by taking data from the four calendar quarters of the LFS and combining them with additional samples of interviews.
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Inactivity
Economically inactive people are those without a job who have not actively sought work in the last four weeks, and/or are not available to start work in the next two weeks.
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Inactivity rate
The headline inactivity rate is calculated by dividing the inactivity level for those of working age by the total working-age population.
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Labour Force Survey (LFS)
The main source for information on the labour market in the UK. It is a random household survey of approximately 53,000 households every three months conducted by the Office for National Statistics (ONS). As well as private households, the survey includes people living in student halls of residence and National Health Service (NHS) accommodation.
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Rates
Generally the preferred measure of Labour market statistics as they allow changes in the labour market to be interpreted in a wider context by allowing for changes in the overall population.
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Working age
Working age is defined as those aged 16 to 59 for women and those aged 16 to 64 for men. This reflects both the current school-leaving age and the state pension ages.
Contact Details
For statistical enquiries about this topic, please contact:
Household, Labour Market and Social Wellbeing Division
Email: labour.market@ons.gsi.gov.uk
Telephone: +44 (0) 1633 455839
Office for National Statistics Government Buildings Cardiff Road Newport Road NP10 8XG
