Labour Market Statistics, May 2020: Analysis of Claimant Count data

This briefing note sets out analysis of the Claimant Count data published this morning (19 May).  The Claimant Count is a measure of the number of people claiming benefits principally for the reason of being unemployed. The statistics released today relate to claimants as at 9 April 2020, so approximately three weeks after the Covid-19 crisis began.

This briefing sets out changes in claimant unemployment overall, by age, gender and then area.  It shows that we have seen a faster rise in claimant unemployment than at any point since 1947, with claimant unemployment increasing by 860 thousand between March and April 2020, from 1.24 million to 2.10 (a rise of 69%).  Claimant unemployment is now at its highest since August 1996.

Of most concern in today’s data is that areas that were most disadvantaged before the crisis appear to have fared worst over the last month. Analysis of the nations and regions of the UK shows that those regions with higher unemployment have seen the largest percentage point increases – with unemployment rising fastest in the North West (up by 3.1 percentage points), the North East (3.0) and Northern Ireland (2.9).

However underneath this, at local council levels the rises in claimant unemployment have been greatest in those areas that had the highest unemployment before the crisis began.  Those areas with highest unemployment have seen rises of on average 2.5 percentage points, to 7.7%; while those areas with lowest unemployment have seen a rise of just 1.4 points, to 2.6%.  This means that the gap between the lowest and highest areas has also widened, from 4.0 to 5.1 percentage points.  This is an increase of more than a quarter in just one month.  In Blackpool, one in nine residents (11%) are now claimant unemployed, up from 7% in March.  One in eleven residents are claimant unemployed in Middlesbrough, South Tyneside, Birmingham, Wolverhampton and Thanet. 

In our view the government now needs to prioritise the rapid scaling up of one-to-one support for those out of work to begin to prepare for a return to work as the economy recovers – mobilising recruitment services, local government, the voluntary and community sector and wider employment services.  Alongside this, we need to begin to develop more intensive active labour market programmes in preparation for the large rises in long-term unemployment that are likely later in the year, including through a guaranteed offer of a job or training place for all long-term unemployed young people. 

Our Getting Back to Work report last month set out further proposals in this space, while today we are also publishing a new report – Help Wanted – co-authored by 13 individuals from nine different employment and social policy organisations, making more detailed proposals for how the employment response to this crisis could be taken forward.