Faulty data overstates surge in UK economic inactivity, finds report

The UK’s job market is performing better than official statistics indicate, with no significant increase in the number of people not working since the pandemic. The employment survey has faced a decline in participation rates, skewing the results towards those more likely to respond. The UK’s workforce has decreased, with a growing number of individuals citing long-term health issues as a reason for not seeking employment. Adam Corlett, the chief economist at the Resolution Foundation, argues that these numbers do not accurately reflect the job market situation and have led to a pessimistic view of the situation. A report released on Wednesday by the think-tank offers a different perspective, based on HMRC tax records that suggest the official survey has been missing out on about 930,000 people who have entered the workforce. The official statistics have been underestimating the likelihood of people having jobs, exaggerating the extent of Britain’s economic inactivity problem, and likely overestimating productivity growth.

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