Weak employment data a cause for concern

Press Releases

19 Jan 2011

The latest Office for National Statistics (ONS) data again showed how insecure the labour market recovery is. The number of people in work fell significantly, by 69,000, over the period from September to November. This is the largest quarterly fall since August 2009. Full-time working was down by 37,000 and part-time by 32,000.

Unemployment grew, by 49,000, on the broader ILO measure, and stands at 2.5 million. However the narrower claimant count fell by 4,100 in December. This fall was driven by declining numbers of male claimants, falling by 6,600, while the number of female claimants rose by 2,500.

Inactivity among 16-64 year olds also grew over the quarter, by 89,000 to reach 9.37 million. While redundancies were also up, by 14,000 in the three months to November.

Jim Hillage, Director of Research at the Institute for Employment Studies, commented on the latest figures:

‘The latest figures highlight growing insecurity in the labour market – with overall employment levels falling by 69,000, and unemployment increasing by 49,000. The weak employment data suggest that the muted recovery in the labour market, which we saw during the middle of last year, has fizzled out. Redundancies are up and with more from the public sector on the way, it is clear that this remains an enormously challenging period.

‘Two areas are of particular concern. Long-term unemployment continues to rise, with 836,000 now out of work for more than a year. While economic inactivity is also up as people decide to retire early and leave the labour market altogether. Secondly, the unemployment rate for those aged 16-24 increased by 32,000, to reach 951,000, the highest level since comparable records began. This is deeply worrying given what we know about the scarring effects which periods of unemployment can have on young people.

‘The figures also again highlight the amount of spare capacity in the labour market. The number of people working part-time because they cannot find full-time work grew by 26,000, stands at 1.16 million, the highest level since comparable records began.’

For further information or comment, contact Lorna Howes on 01273 763414 or lorna.howes@employment-studies.co.uk