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Impact of coronavirus (Covid-19)

The latest labour market statistics suggest that the coronavirus pandemic is having an impact on the labour market for young people with an increase in unemployment and a large fall in employment over the last quarter.

In May-July 2020:

  • 563,000 young people aged 16-24 were unemployed, an increase of 36,000 from the previous quarter.
  • 6 million young people were employed, down 156,000 from the previous quarter
  • 7 million young people were economically inactive, an increase of 110,000 from the previous quarter

In August 2020, 526,000 people aged 16-24 claimed unemployment related benefits. This was an increase of 291,000 (124%) claimants from March 2020, when the UK lockdown began. Some of this increase will be due to employed people who have become eligible for Universal Credit as part of the government response.

The Coronavirus Job Retention Scheme (CJRS) opened to applications on the 20 April 2020. By midnight on the 31 July 2020, around 970,000 jobs had been furloughed through the CJRS by employees aged 16-24. This was 47% of eligible jobs.

According to the Resolution Foundation, one-third of 18-24-year-old employees (excluding students) have lost jobs or been furloughed, compared to one-in-six prime-age adults 35% of non-full-time student 18-24-year-old employees are earning less than they did prior to the outbreak, compared to 23% of 25-49-year-olds.

More information can be found in the Library briefing Coronavirus: Impact on the labour market.

563,000 young people aged 16-24 were unemployed in May-July 2020, an increase of 36,000 from the previous quarter and an increase of 76,000 from the year before. This is the highest level of youth unemployment since 2016, although by historical standards, unemployment levels for young people are low. For context, it is worth noting that the total population aged 16-24 has been declining in recent years; in the year to July 2020, it decreased by 43,000

The number of young people in employment fell by 152,000 from the previous year, and fell by 156,000 from the previous quarter. The number who are economically inactive (not in or looking for work) increased by 33,000 from a year before, and increased by 110,000 from the previous quarter.

The unemployment rate (the proportion of the economically active population who are unemployed) for 16-24 year olds was 13.4% in May-July 2020. This is up from 12.2% in the previous quarter and from 11.4% a year before.

The inactivity rate for young people is 38.9%. Around three quarters of young people who are economically inactive are in full-time education.

Youth claimant count

In August 2020 526,000 people aged 16-24 claimed unemployment related benefits. This was an increase of 291,000 (122%).

Youth Unemployment across Europe

The UK youth unemployment rate was 11.6%, compared to 15.0% for the European Union.

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