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UK Unemployment is the Largest Since 1995; but is It All That Bad?

Posted on the 15 February 2012 by Periscope @periscopepost
UK unemployment is the largest since 1995; but is it all that bad?

A job center. Photocredit:

Uh oh. Unemployment in the United Kingdom has risen by 48,000 to 2.67 million – the worst number since the end of 1995. This is the smallest quarterly rise since last summer. The number of people on Jobseeker’s Allowance has jumped to 1.6 million (a rise of 6,900.) Employment has increased by 60,000 to 29 million – mostly, according to The Daily Telegraph, because of the rise in the number of part-time employees. Economic inactivity, including students and those who are ill, has fallen by 78,000. Average pay has increased by 2 per cent. Young people are bearing the brunt of the economic conditions, with 1.04 million 16-24-year olds out of work. So what’s with the anomalous figures? Unemployment’s up – but so is employment? Average pay’s up – but not in line with inflation? Public sector pay is down? The over sixty fives are working? WHAT’S GOING ON? Well, the general consensus is that those on the right say the figures are signs of a stabilising economy; those on the left say we’re all doomed. So there you go.

We’re fine! “The latest figures show some encouraging signs of stability despite the challenging economic climate. With more people in employment and a rise in vacancies, it is clear the private sector is still creating jobs,” said Lord Freud, the Minister for Welfare Reform, quoted on The Daily Telegraph. Howard Archer of IHS Global Insight agreed, saying that it meant the employment outlook had eased, and that there were signs that the economy will “return to modest growth,” he told the BBC.  Alan Clark of Scotiabank told The Guardian that  ”If there was any doubt that the UK economy had turned the corner and that the worst news was in the past, then today’s labor report should lay those concerns to rest.”

No we’re not! However, Paul Kenny, the general secretary of the GMB union, said that it was obvious that austerity plans were not working, and that the government should be getting people pack into work, quoted on The Daily Telegraph. The TUC’s general secretary, Brendan Barber, agreed on the BBC, saying that “the government’s mantra that there are plenty of jobs out there just doesn’t ring true.”

We need to think about deeper issues. Jonathan Jones on The Spectator wondered how we’ve “seen both more jobs and lengthening dole queues.” It’s because the “economically active” population has grown quicker than “employment.” So there are 31.8 million who are “economically active” – 320,000 more than since the coalition came to power – but there’s only a 110,000 rise in employment. Employment has increased by 285,00- since the election – but this is mostly accounted for by the 262,000 non-UK born immigrants. UK-born employment is up by only 17,000. It’s a “clear reminder that creating jobs is not enough.” We need to do more on “the supply-side”, and look harder at welfare and education reforms.

We need to think about what jobs there actually are. “We hear a lot,” said George Eaton on the New Statesman’s Staggers blog, about the “scourge of unemployment”, but “too little about the scourge of underemployment.” This rise in part time working is worrying – we need to think about the “quality” of jobs, too. ”

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