Glimmer of hope on local unemployment

UNEMPLOYMENT has hit a 12-year high of more than 2.2 million with a record number of people having lost their jobs in recent months, official figures showed yesterday.

The jobless total increased by 232,000 in the three months to April to 2.26 million, the highest figure since late 1996 when the government of John Major was still in office.

The narrower count of those eligible to claim the Jobseeker's Allowance increased by 39,300 in May to 1.54 million - the highest total since the summer of 1997, shortly after Labour came to power.

More than 300,000 people were made redundant during the three months to April, an increase of 36,000 on the previous quarter and the highest total since records began in 1995, while long term unemployment - those out of work for more than a year - increased by 54,000 to a 10-year high of 515,000.

The number of people in work fell by 271,000 over the three months to 29.11 million, the biggest quarterly slump since comparable records began in 1971, and vacancies fell by 38,000 to 444,000, another record low.

With unemployment being a lagging indicator, the figures are likely to continue to worsen over the coming months even if hopes of a relatively early end to the recession prove justified.

However, for the second month running, there was at least some limited evidence of the employment situation starting to stabilise in Suffolk and north Essex.

Most districts registered modest falls in the claimant count compared with April, although this appeared to be largely due to normal seasonal factors for which - unlike the national figures - the local data is not adjusted.

Year-on-year, the total count of 29,699 for Suffolk and north Essex remained more than double the equivalent figure 12 months ago, reflecting the dramatic increases seen in the months following last autumn's financial crisis which sparked the economy's slide into recession.

In Suffolk, the biggest falls, reducing the local unemployment rate by 0.1 of a percentage point in each case, were in Ipswich, where the count fell by 81 to 3,847 (5.1%), Forest Heath, down 30 to 1,051 (2.6%), and St Edmundsbury, down 19 to 1,998 (3.2%).

Falls elsewhere left the local rate unchanged in Babergh, down 37 to 1,476 (3.0%), Mid Suffolk, down 51 to 1,252 (2.3%), Suffolk Coastal, down 45 to 1,538 (2.2%), and Waveney, down 16 to 3,047 (4.6%).

In Essex, a fall of 136 in the Tendring district reduced the count to 3,564 and the rate by 0.2% to 4.6% while smaller falls left the rate unchanged in Colchester, down 88 to 3,602 (3.2%), Braintree, down 19 to 3,070 (3.6%), and Uttlesford, down one to 950 (2.2%).

However, in Chelmsford, the count increased by 75 to 3,092 and the rate by 0.1% to 3.0%, while in Maldon an increase of nine to 1,212 saw the rate remain unchanged at 3.2%.

TUC general secretary Brendan Barber said: “Economists may argue about whether we are now out of recession and into recovery, but in the real world of Britain's workplaces people are still losing their jobs and finding it harder and harder to get new ones.

“Unemployment is now at its highest level since Autumn 1996 and it will take years, not months, to recover. If we are to avoid the 10% unemployment rates of the 1980s and 1990s it is imperative the Government continues to invest in tackling unemployment.”

However, David Kern, chief economist at the British Chambers of Commerce, said the Government should consider easing “harmful” labour market regulations that were adding pressure on businesses.

“Jobs are being lost relentlessly and many businesses are facing a major threat to their skills base. It is much too early to talk about the end of recession,” he said.

John Cridland, deputy director general of the CBI, added: “The numbers of jobless are continuing to rise and we're clearly not through the worst yet. Sadly, the CBI expects these figures to continue to rise and peak at three million in the spring of 2010.”