institute for employment studies

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Employment figures highlight the fragility of the labour market

15 December 2010

The latest Office for National Statistics (ONS) data showed how delicate the labour market recovery remains. Total employment fell by 33,000 in the period from August to October as a result of declining public sector employment. Separate figures released by ONS show that the biggest employment losses, 18,000, were in local government.

Unemployment grew, by 35,000, on the broader ILO measure, to reach 2.5 million. The unemployment rate stands at 7.9. However, the narrower Claimant Count fell back fractionally, by 1,200, in November.

Inactivity also rose by 22,000 with the largest increase among those taking early retirement.

Nigel Meager, Director of the Institute for Employment Studies, commented on the latest figures:

‘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.

‘Unemployment stands at 2.5 million, having risen by 35,000, and it is clear that conditions remain very tough for jobseekers, with 5.5 unemployed people for every vacancy. More than one-third of the unemployed have been out of work for 12 months or more, and the number of long-term unemployed is at its highest since 1997.

‘The rise in unemployment was more marked among women, and while in the past 12 months the general trend in male unemployment has been downwards, for women it has been clearly upwards, growing by some 89,000. With women more heavily represented in the public sector this trend may be set to continue.

‘The figures also highlight the amount of spare capacity in the labour market, and the number of people working part-time because they could not find full-time work is now at the highest level since records began, standing at 1.16 million. The growth in those working in temporary contracts because they couldn’t find permanent work also continued, growing by 23,000 over the quarter to reach 592,000.’

For further information or comment, contact Nigel Meager or call , or the IES press office, or call 01273 763414.