13th Jul 2011 - What hides underneath the new employment figures?
What hides underneath the new employment figures? Confused?
Don’t you just love the inconsistency in data spun out by consecutive governments? If it doesn’t confuse you, it certainly does me. The good news on one hand is that UK unemployment fell by 26,000 in the three months to May to 2.45 million, including 16-24 year olds, official figures show. The downside is that people claiming Jobseeker's Allowance in June rose by 24,500 to 1.523 million - the biggest increase in two years. Why the disparity?
The main part of the discrepancy between the two measures was due to an increase in the number of women claiming Jobseeker's Allowance as a result of a number of changes in the benefits system.Also worth noting is the quality of the vacancies being filled, as two-thirds of the increase in employment was due to part time jobs. People are accepting lower quality jobs because there is less opportunity out there. There were also fewer new vacancies on a like-for-like basis, which dropped by 7000.What lies underneath; well the reality is that we need to ask questions about whether the private sector can really act as a shock absorber for rebalancing away from public sector towards private sector employment. In my opinion there are too many variables in the background to accurately predict a trend.
The unfortunate reality is that most of the background noise is from a slightly negative standpoint. I’m ever the optimist and believe that if the debt problems within the Euro zone don’t swallow us up then we stand a very good chance of steadily but slowly emerging to a good growth rate with unemployment numbers falling. This is as much about being psychologically strong and positive about our prospects as it is about being accepting of our current plight, given we have had years of decay in the balance of the wider economy and that this decay is being finally being addressed.
It’s a world full of different opinions; what’s yours?
David Archer
