The Office for National Statistics today revealed that the number of people out of work has risen to 2.52 million, a total of 7.8% of the working population. Thankfully, not all of the figures are bad: the number of people claiming Jobseeker’s Allowance actually fell by 7,300 to 1.52 million. So swings and roundabouts right?
Well, not really. The ONS actually took the liberty of commenting on its figures, with a spokesman saying that the recent string of falling unemployment figures ‘seems to have come to an end’. The figures also suggest that the speed at which earnings are growing is slowing down even further. During the period, average earnings grew by 0.8%, the smallest rise since records began in 2001. So with inflation still at 2.8%, people’s wallets are being squeezed more and more even if they’re in work.
However, since the economy expanded by 0.3% - rather more than analysts were expecting – in the first quarter, it is possible that there will be a sort of lag before the effect of that growth is felt in the jobs market. If firms did better in those three months, then they will need to get paid for all their orders before cash flow allows them to start advertising more jobs.
But however optimistic we’re trying to be, ultimately the situation will probably get worse before it gets better. Remember there is another slew of public sector job cuts in the pipeline and with consumer confidence remaining stubbornly low, most firms are not going to be in a rush to hire new people…