Jobless total climbs to 2.5 million - up 7.9%

Published by Ross Macmillan for 24dash.com in Communities

The Government was given some grim pre-Christmas news on jobs today when unemployment increased by 35,000 and the number of young people out of work reached near-record levels.

The jobless total climbed to 2.5 million in the quarter to October, a rate of 7.9%, the highest since the start of the year.

There were 839,000 people unemployed for more than a year, up by 41,000 over the three months and the worst figure since 1997.

The Office for National Statistics also reported that the number of 16 to 24-year-olds out of work increased by 28,000 to 943,000, one of the highest figures since records began in 1992, giving a jobless rate of 19.8%.

Male unemployment increased by 11,000 to 1.46 million, while the number of women out of work rose by 24,000 to 1.04 million, the highest total since 1988.

There was also a rise in the number of people classed as economically inactive, including people looking after a sick relative, students or those who have given up looking for a job, up by 22,000 to 9.29 million, a rate of 23.2%.

The category showing the biggest increase was those who have taken early retirement, which rose by 27,000 to 1.53 million.

The number of people working part-time because they could not find a full-time job increased by 46,000 to 1.16 million, a record high.

The number of people claiming Jobseeker's Allowance fell by 1,200 last month to 1.46 million, although the number claiming for up to six months rose by 11,600 to 954,900.

There were 158,000 redundancies in the latest quarter, up by 15,000, the first rise since April.

Employment fell by 33,000 to 29.13 million, giving the first quarterly fall in the rate since April - down by 0.1% to 70.6%.

Average earnings increased by 2.2% in the year to October, up by 0.1% from the previous month.

Other figures showed that public sector employment has fallen by 33,000 to just over six million, including 18,000 in local government and 8,000 in the civil service.

Private firms employed 23.11 million workers, unchanged from the summer.

Unemployment in the regions between August and October was:

Region      Total unemployed     Change on quarter      Unemployment rate

North East 124,000 plus 6,000 9.7%

North West 279,000 plus 2,000 8.1%

Yorkshire/Humber 244,000 plus 1,000 9.3%

East Midlands 188,000 plus 19,000 8.2%

West Midlands 238,000 plus 12,000 8.9%

East 202,000 minus 2,000 6.7%

London 376,000 minus 4,000 9.1%

South East 276,000 plus 3,000 6.2%

South West 154,000 minus 8,000 5.7%

Wales 125,000 plus 4,000 8.6%

Scotland 234,000 minus 5,000 8.7%

N Ireland 63,000 plus 6,000 7.6%

Employment Minister Chris Grayling said: "These figures highlight the crucial importance of the action we are taking to keep the economy moving forward. It's essential to create a stable environment where businesses can flourish and create jobs - with those on benefits at the front of the queue to take them up.

"That's why we are increasing the support available to people through both Jobcentre Plus and our new Work Programme which will revolutionise the way in which we help the long-term unemployed into sustained employment. Only with a successful economy will we be able to finally get Britain working again."

GMB general secretary Paul Kenny said: "The billions pumped into the economy and the banks by the Labour government restarted the growth which we have seen so far this year to recover from the bankers' recession.

"Today's rise shows how much of an uphill struggle it is for the jobless to find work as there are three registered claimants chasing each job vacancy and the prospects are worse when all those looking for work but not on the register are added in.

"The Government are now taking money out of the economy and their policy is to cut the number of jobs in the public sector by one third of a million. The Government are ignoring the lessons of history, that it is not possible to deflate your way to growth and a balanced budget.

"There are troubled times ahead and a lot of families face a miserable Christmas and bleak prospects for 2011."

TUC general secretary Brendan Barber said: "Unemployment increased by 55,000 in October - the sharpest monthly increase since May 2009.

"The number of people out of work has passed the grim milestone of 2.5 million before the Government's austerity measures have even started to take effect. The jobs outlook in the coming years looks increasingly bleak.

"The big fall in full-time employment - partly hidden by rising involuntary part-time work - is particularly alarming as these are the kind of jobs we so desperately need to get our economy growing again.

"Government support for the unemployed may have ended but our jobs crisis certainly hasn't."

Dave Prentis, general secretary of Unison, said: "The Government's policies are clearly not working. The private sector is not coming to the rescue. Behind these figures are families struggling to get by, landed with a bitter blow of unemployment - some Christmas present from this Government.

"Worse is still to come, when the hundreds of thousands of job losses in the public sector, particularly in local government, start hitting home.

"There is another way, but the Government is ideologically driven to cut back on our public services, whatever the consequences."

John Walker, chairman of the Federation of Small Businesses, said: "With inflation expected to remain above 3% in the foreseeable future, combined with public sector job cuts, these unemployment statistics are a worrying sign. Small firms expect to take on seasonal workers over the Christmas period - the busiest time of year for any business.

"But if these are to be made into permanent jobs they really need the Government to give them a Christmas present by extending the National Insurance holiday to existing firms and raising the threshold at which businesses start paying VAT when the rise hits in January. Small business owners need encouragement to take on new members of staff in 2011 in order to reverse this worrying trend."

Douglas Alexander, shadow work and pensions secretary, said: "All of us will be hoping this is a one off but my fear is that we are now beginning to see the real cost of George Osborne's economic experiment.

"These worrying figures show that the private sector is not yet creating enough jobs to make up for the posts that are being cut in the public sector.

"No wonder the government's top civil servant is worried they don't have a Plan B."

Graeme Leach, chief economist at the Institute of Directors said: "The labour market looks very flat, and doesn't fill us with confidence about the pace of economic recovery. Employment, particularly full-time employment, is down and the labour force survey measure of unemployment is up. Claimant count unemployment and vacancies are basically flat.

"The softening in the labour market reinforces our message that economic recovery will weaken in 2011."

Paul Brown, director of youth charity The Prince's Trust said: "Youth unemployment is like a dripping tap, costing tens of millions of pounds a week through benefits and lost productivity, and, just like a dripping tap, if we don't do something to fix it, it's likely to get much worse.

"It's now crucial to give young people the support they need to prevent them from falling into the downward spiral of long-term joblessness. Transforming these young lives will have a huge impact on their families, communities, as well as on Britain's economy."

Dr John Philpott, chief economic adviser at the Chartered Institute of Personnel and Development, said: "The latest jobs market figures are much worse than expected and the opposite of what was wanted in the run-up to Christmas, with no joy and very little comfort on offer.

"It is especially disappointing to see the positive momentum that had built up earlier in 2010 appear to run out of steam even before the full impact of the coalition government's spending cuts and tax hikes take effect. This does not bode well for 2011.

"The limited comfort in the latest jobs figures comes in the form of another slight fall in the number of people claiming jobseeker's allowance and a tiny increase in job vacancies. But the remainder of the ONS statistical release reads as if it was scripted by the Grinch who stole Christmas."

Ian Brinkley, associate director of The Work Foundation said: "The labour market recovery has stalled, but it is premature to talk about a double dip recession. The fall in employment, hitting women more than men, and rise in unemployment shown by the Labour Force Survey are small, comparing the three months to October with the previous three months.

"The bigger concern is that we have still seen no turn-round in full-time jobs. Full-time jobs are still falling and there has been a significant increase in the number of people in part-time work because no full-time jobs were available. Until full-time jobs start to increase again the labour market will not be able to absorb large-scale job losses in the public sector. Unemployment in 2011 must then inevitably rise."

Nigel Meager, director of the Institute for Employment Studies, said: "The figures again serve to highlight the fragility of the labour market recovery. Overall employment fell slightly, by 33,000, as a result of the decline in public sector employment, which is now starting to show up clearly in the official figures.

"Redundancies in the public sector are now running at twice the rate of a year ago, whereas redundancies in all other sectors have fallen over the period."

Len McCluskey, Unite's general secretary-elect said: "These grim figures prove Cameron, Clegg and Osborne are not the three wise men. The coalition's economic policy of severe cuts will only make things even worse in the New Year.

"If the country's leaders had any wisdom they will make it their New Year's resolution to step back from the brink and start supporting young people and investing in our economy for jobs and for growth."

Prime Minister David Cameron said he was "concerned" about the unemployment figures, but promised that the Government's Work Programme would be the biggest effort in 70 years to help the unemployed find jobs.

Mr Cameron told the House of Commons at Prime Minister's Questions: "Of course anyone should be concerned, and I am concerned by a rise in unemployment.

"Anyone who loses a job is a tragedy for that person, and we must do everything we can to help people into a job. With the Work Programme, we will be launching the biggest back-to-work programme in this country for 70 years.

"Whilst part of the figures are disappointing... they are mixed, because we see the claimant count has come down in the unemployment figures.

"Also we are seeing an increase in the number of vacancies in our economy. Every day there are another 10,000 vacancies.

"So, yes, we have got to get the private sector going, increase the number of jobs that are available. Over the last six months, we have seen 300,000 new private sector jobs. We need more of them, and keeping the economy out of the danger zone is the way to get them."

Labour leader Ed Miliband accused Mr Cameron of complacency on jobs, saying he seemed to be trying to "paint himself as an innocent bystander in relation to the unemployment figures".

"Does he understand that his confidence that Britain is out of the danger zone will seem very hollow?" Mr Miliband asked.

And he added: "He should not be pressing ahead with a rise in VAT on January 4 and £20 billion of public spending cuts."