Employment falls but still high
Employment fell by 16,000 over the three months to June but is still slightly higher than this time last year, new figures from the Office for National Statistics show.
The employment rate for people of working age was 74.7 per cent for the second quarter, down from 74.9 per cent for the previous quarter but up from 74.6 per cent on the year.
Unemployment is almost unchanged, with the number of unemployed increasing by 27,000 over the quarter but falling by 24,000 over the year, to reach 1.42 million.
The claimant count is up for the sixth month running, to 866,000 in July, but the increase was smaller than previously, while the number of vacancies remains high at 640,000.
Work and pensions minister James Plaskitt welcomed the increase in employment year on year but admitted the figures for the quarter show a more “mixed” picture.
“Although employment has fallen back from an historically high level and unemployment is slightly higher, vacancies remain strong and redundancies are low,” he said.
The inactivity rate for people of working age is up slightly to 21.4 per cent on the previous quarter, but Mr Plaskitt said that when students were discounted, this has actually fallen.
He also noted there are more than 60,000 fewer people claiming lone parent and incapacity benefits, that vacancies remain high and that redundancies, at 127,000, were at the second lowest level on record.
“We are re-doubling our efforts to help as many people as possible take up new job opportunities as they arise. Over 10,000 new vacancies are placed at Jobcentre Plus offices every working day and at least as many again advertised through other recruitment channels,” Mr Plaskitt continued.
“With fewer people losing their jobs, we have an opportunity to fill vacancies and increase employment, particularly through helping people such as lone parents and those with disabilities move back into the labour market and from there into work.”
However, shadow work and pensions secretary Sir Malcolm Rifkind described the declining employment figures as “very worrying indeed”.
“The government needs to explain why unemployment and benefit claims are rising when more job vacancies are becoming available. With over a million young people not in work or education, these figures betray a clear failure of Labour policy,” he said.
Lib Dem Treasury spokesman Vincent Cable also expressed his concern, particularly about chancellor Gordon Brown’s “complacency” about the issue.
“These figures are deeply worrying with higher unemployment likely to have knock-on effects on consumer spending and the fragile housing market. It is likely more and more people will be getting into arrears on mortgage payments,” he said.
“The UK economy may still be growing but the chancellor’s complacency is starting to become worrying.”
