According to the figures, the number of people claiming Jobseeker’s Allowance rose by 2,400 last month, to 1.46m - an unpleasant reversal after the figure dropped slightly during the three months to November. The number of long-term unemployed also grew by 17,000, to 833,000. And the number of people plumping for a part-time job because they couldn’t find a full-time one rose, too, by 44,000 to 1.19m – the highest since records began in 1992. None of which is tremendously hopeful.
What we don't know yet is how much of these job losses came in the the public sector - although with £81bn of public spending cuts starting to bite, and employers plotting redunandcies across the sector, there's no doubt about what's coming. And the worrying thing for the Government will be that judging by the dismal UK growth figures last quarter, there's no sign that the private sector is ready and waiting to pick up the slack. Or at least, not yet.
Wage growth was at least in positive territory, rising by 1.8% in the year to December (although even that’s down from the 2.1% recorded in the year to November). But with inflation having risen to 4% in January, that still means take-home pay is shrinking in real terms.
No wonder, then, that consumer confidence fell at its ‘fastest rate on record’ over January, according to a survey by Nationwide. Its index fell by 20 points to 70, the lowest level since November 2008 (when the UK was in recession), and its biggest fall since the study began in 2004. Crucially, people aren't expecting things to imporve any time soon, either: the imaginatively-titled ‘expectation index’ fell by 10 points, with fewer than 20% of people expecting the economy to improve over the next six months, and just over a third saying they think it will get worst. A gloomy 58% said they’re not anticipating there to be many jobs available, while just under one in five said they expect a fall in their household income.
With inflation still rising, and unemployment still rising, we imagine that Nationwide index is only going in one direction over the next few months...