Cuts still not feeding through to unemployment figures

Unemployment actually fell last quarter, by 9,000. So are we in better shape than we thought?

by Emma Haslett
Last Updated: 10 Dec 2010
Some surprise news from the Office of National Statistics today: on the ILO measure, UK unemployment actually fell by 9,000 in the three months to September, leaving the total pretty much unchanged at just under 2.45m (that's 7.7%). Unfortunately, there are some quite big caveats. That still means the recovery is proving much slower than after previous recessions. Lots of these new jobs were apparently part-time rather than full time. And it looks as though the job losses from the Government cuts haven't started in earnest yet...

According to the figures, overall employment increased by 167,000 to 29.19m. Since the unemployment rate hasn't fallen by anything like that much, this suggest that the jobless count is, in part, being replenished by those people who have decided to start job-hunting (again). Not good news for a Government keen to push down its welfare bill - though today's figures showed that the number of people claiming on benefits also fell a touch, by 3,700 to 1.47m - almost offsetting last month's 5,300 rise.

But generally, the picture still looks pretty gloomy. The number of job vacancies apparently fell by 27,000 in the three months to October. And the figures showed that a large chunk of those new jobs created were part-time rather than full-time. Apparently, part-time workers now make up 27.3% of those employed, which is up by more than 3% since 2008 (when it stood at 25.4%). That suggests businesses are still cautious about forking out for new roles.

Salary levels have at least improved slightly; according to the report, the average pay was up by 2% on a year ago – which is, at least, slightly above the 1.7% of the previous quarter. Good news for workers – though given that inflation is running above the 3.2% mark, 2% is still effectively a pay cut.

And more significantly, these figures clearly don't (yet) reflect the effects of the spending cuts, which are predicted to cost the UK economy about 500,000 jobs. So this latest dip is likely to be short lived.
Economy Misc

Find this article useful?

Get more great articles like this in your inbox every lunchtime

Leading from a distance: Remote working for the C-suite

Leadership lessons video panel: Chris Hirst, CEO of Havas Creative; Matt Peers, COO of Linklaters;...

There’s little point saving your business if you let your market die

Opinion: The nature of the coronavirus pandemic demands we look out for each other.

C-suite and furloughed

Use this as an opportunity to take a breath and get some perspective, says this...

Books for CEOs: Daniel Goleman, Jack Welch, Nelson Mandela

Beaverbrooks CEO Anna Blackburn shares her reading list.

What happens next: COVID-19 lessons from Italian CEOs

Part I: Marco Alvera, chief executive of €15bn Lombardy-based energy firm Snam, on living with...

Coronavirus communications: Dos and don'ts

Uncertainty and isolation make it more important than ever to be seen, to be heard...