Why are people economically inactive?

The latest Labour Market Statistics released today show that unemployment in the UK is falling and the employment level and rate is now the highest it has been since comparable records began in 1971.

However, another good indicator of the performance of the Labour Market is the level of economic inactivity. Economically inactive people are those without a job who are not seeking work and/or are not available to start work in the next two weeks. The main economically inactive groups are students, people looking after family and home, long term sick and disabled, temporarily sick and disabled, retired people and discouraged workers.

Since the early 1970s the number of economically inactive 16-64 year old women has fallen from 7.6 million in the first quarter of 1971 to 5.6 million in the last quarter of 2014. In the same period economic inactivity amongst men in the age group has increased from 0.8 million to 3.4 million:

Economic inactivity by gender
During the economic downturn in 2008, the rate of inactivity began to increase (as it did in the downturn in the early 1990s), however, it started falling again in the start of 2011 but has been increasing since mid-2014.

Economic inactivity rate

Reasons for inactivity

Generally, the most popular reason for inactivity is that a person does not want a job (6.8 million in October-December 2014) or that they are a student (2.3 million).

When we look at reasons for inactivity by gender, the main reasons for men aged 16-64 being economically inactive is that they are students or long term sick, a similar number of economically inactive women fell into these categories.

However, when you look at the number of people who are inactive as they were looking after the family/home, there are over 2 million women in this category compared to 233,000 men:

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Author: Aliyah Dar