East Anglia: Unemployment figures follow national downward trend

Claimant county unemployment has seen its biggest two-month fall since 1997, official figures reveal

Claimant county unemployment has seen its biggest two-month fall since 1997, official figures revealed today. - Credit: PA

Mixed signals emerged from the jobs market today as official figures revealed a fall in unemployment, but with the number of those forced to take part-time work hitting a record high.

Total unemployment dropped to 2.49million in the three months to July, helping nudge the jobless rate down to 7.7% from 7.8%, data from the Office for National Statistics (ONS) showed.

The so-called claimant count, the number claiming the Jobseeker’s Allowance, fell by 32,600 in August to 1.4million on a seasonally adjusted basis, and by nearly 29,000 unadjusted for normal seasonal variations.

July’s claimant count was also revised lower, makingd the combined 68,900 fall in claimants in July and August the biggest two-month drop since June 1997.

The Government insisted the economy was “turning the corner” as the number of people in work increased by 80,000 in the quarter to July, rising to 29.84m, hitting another record high as the population continues to swell.

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But the continued squeeze on household incomes was highlighted by a 1.1% increase in average weekly earnings between May and July versus a year earlier, meaning that pay continues to lag behind inflation which is running at 2.8%.

The number of people working part-time because they cannot find a full-time job increased by 25,000 in the quarter to 1.45m, the highest since records began in 1992, and the figure has now doubled over the past five years, the ONS said.

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But Employment Minister Mark Hoban insisted: “This is a really encouraging set of figures, with the number of people in work rocketing by 80,000 in only three months, a rise driven entirely by a growth in full-time jobs.

“The private sector has created jobs for 1.4 million more people under this Government, and there are now more people employed in the private sector than ever before.”

But TUC general secretary Frances O’Grady said: “Despite the Chancellor’s boasts this week, austerity is continuing to cause damage and we are far from a strong and sustained jobs recovery.

“While the headline figures show small improvements, youth employment has fallen sharply and long-term unemployment is still rising. There are also still record numbers of people trapped in involuntarily part-time work, with underemployment continuing to soar.

“Across the economy ordinary people are yet to feel the benefits of tentative growth, with wages rising around three times slower than prices.”

Claimant counts followed the national downward trend in most parts of Suffolk and north Essex.

In Suffolk, local unemployment rates fell by 0.1 of a percentage point in Ipswich, where the count fell by 71 to 3,482 (a rate of 4.0%), St Edmundsbury, down 77 to 1,377 (2.0%), Forest Heath, down 25 to 714 (1.8%), and Waveney, now 97 to 2,353 (3.5%).

Relatively smaller changes elsewhere in the county left the rates unchanged in Suffolk Coastal, down 33 to 1,052 (1.5%), Mid Suffolk, down 12 to 906 (1.5%), and Babergh, down eight to 1,011 (1.9%).

In north and mid Essex, Colchester bucked the national trend with the count edging 15 higher to 2,785, although this left the local jobless rate unchanged at 2.4%.

The biggest falls, cutting the rate by 0.1% in each case, were in Tendring, where the count fell by 126 to 2,857 (a rate of 3.7%), and Braintree, down 64 to 2,144 (2.3%).

Smaller falls left the local rates unchanged in Chelmsford, down one to 2,464 (2.3%), Uttlesford, down 10 to 595 (1.2%), and Maldon, down 13 to 767 (2.0%).

The unemployment rate has taken on new significance after the Bank of England said it will not consider raising interest rates from their record low until it falls to 7%, which it forecasts will take around three years, barring a spike in inflation.

Borrowing costs have been rising as markets speculate the Bank will lift rates sooner.

Martin Beck, UK economist at Capital Economics, said the jobs market appears to be “fully sharing in the economy’s momentum”. But he said with plenty of scope to improve productivity, it should take a long time for the jobless rate to fall to 7%.

He said: “Although employment rose strongly, more timely evidence from the recent activity surveys suggests that firms are responding to higher demand more by boosting productivity than taking on new workers.”

Kathleen Brooks, UK research director at Forex.com, added that the Bank “may not be losing too much sleep” as the jobless statistics show pockets of weakness.

David Kern, chief economist at the British Chambers of Commerce, said the figures show that the private sector is driving the recovery.

“While it is concerning that there were increases in youth unemployment and the long-term unemployed, it is pleasing that the number of those claiming benefits continues to fall,” he said.

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