According to official figures, more than a fifth of UK working-age adults remain unemployed and are not actively seeking employment.
The economic inactivity rate stood at 21.5% in the three months to January, down from the previous quarter and year. While relatively low compared to historical trends since 2009, the issue has gained attention as the Government pushes for economic growth.
This comes alongside controversial plans to cut sickness and disability benefits, aiming to save £5 billion annually by 2030. Ministers argue the reforms will encourage more people to work while protecting those genuinely unable to work. However, Labour backbenchers, unions, and charities warn the changes could push more disabled people into poverty.
The Office for National Statistics (ONS) cautioned that employment survey figures should be interpreted carefully due to low response rates. However, it noted that economic inactivity has generally declined since records began in 1971, despite a rise during the Covid pandemic.
The latest figures show a 0.6% drop over the past year and a 0.2% quarterly fall, mainly due to more people aged 35 to 49 re-entering the job market.
Meanwhile, pay growth continues to outpace inflation, with wages rising 5.9% annually. Retail, hospitality, and construction saw particularly strong wage increases.
The Bank of England, which closely monitors pay and employment trends, is expected to keep interest rates at 4.5% in its latest decision.
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