Black Christmas for the jobs market

Press Releases

14 Dec 2011

Today's figures from the Office for National Statistics show clearly how much the labour market has deteriorated in the last 18 months, following the faltering early recovery from recession:

  • The headline unemployment figure from the Labour Force Survey increased by 128,000 over the quarter to October taking the total to 2.64 million, its highest level for 17 years. The unemployment rate stands at 8.3 per cent.
  • Within the overall total, youth unemployment continued to grow and has now reached 1.03 million, 22.0 per cent of the economically active population aged 16-24.
  • The monthly claimant count figure (the numbers claiming Jobseekers' Allowance) rose by 3,000 in November, taking the total to 1.6 million.
  • The numbers in employment fell again by 63,000 in the quarter to October. The latest figures for public and private sector employment (for the quarter to September) show that the total in the public sector fell by 67,000. This reduction was nearly all in local government and greatly outstrips the growth of 5,000 in the private sector. Compared with the previous year, public sector employment has now fallen by 276,000.
  • Job vacancies remained flat, recording a small fall of 18,000 to 455,000 in the three months to November.
  • The overall level of redundancies hardly changed over the quarter to October, but the detailed figures at industry level show that redundancies in sectors with a concentration of public sector employers have continued to increase.

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

‘The economy is still flat on its back, with GDP at four per cent below the pre-recession level.

‘The employment figures are entirely consistent with this bleak economic background. Chronic lack of demand in the macro-economy means that a new private sector upsurge, perfectly timed to offset massive job cuts in the public sector, was always implausible. The latest figures show that it certainly isn't happening, and the flat level of vacancies confirms that businesses are extremely cautious in hiring.

‘The Eurozone difficulties didn't cause this situation, but they will impair the chances of an early labour market recovery. Subdued business confidence will hinder recruitment by private sector employers, as the public sector jobs haemorrhage continues.

‘While the Chancellor's Autumn Statement contained welcome moves in the right direction, they are likely to be too small and too slow in coming through to prevent further employment falls in the months ahead. Many more thousands of families will experience the unnecessary damage of job loss and sustained unemployment, unless larger and more rapid steps are taken to address the gap in demand. This would require significant fiscal stimulus (such as a cut in VAT or National Insurance) and a slowing of the pace of deficit reduction.᾿


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The Institute for Employment Studies is the UK’s leading independent, not-for-profit centre for research and evidence-based consultancy on employment, the labour market, and HR policy and practice.