Jobless total hits eight-year high

UNEMPLOYMENT has hit a new eight-year high after the steepest increase for more than 17 years, official figures revealed yesterday.Total unemployment during the quarter to August - including those not eligible for benefit - averaged 1.

UNEMPLOYMENT has hit a new eight-year high after the steepest increase for more than 17 years, official figures revealed yesterday.

Total unemployment during the quarter to August - including those not eligible for benefit - averaged 1.79million, an increase of 164,000 compared with the previous three months.

It is the highest total since the spring of 2000 and the biggest quarterly increase since the summer of 1991, when the UK was suffering its last recession.

The number people claiming the Jobseekers' Allowance rose by 31,800 last month compared with August to 939,000, its eighth consecutive monthly increase, and, with the UK now widely seen as heading into a fresh recession, the claimant count is thought likely to top one million by the end of the year.


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Yesterday's data from the Office for National Statistics also revealed plunging levels of employment, with the number of people in work falling by 122,000 during the latest quarter to 29.4 million, the biggest three-monthly fall since 1993.

A total of 147,000 people were made redundant during the three months to August, an increase of 28,000 on the previous quarter, and the number of people out of work for more than a year increased by 35,000 to 440,000.

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However, Suffolk and north Essex fared relatively better last month than in August when claimant counts jumped sharply, increasingly local unemployment rates by up to 0.4 of a percentage point.

Worst hit in September was Tendring, where the count grew by 90 to 2,136 and the rate by 0.1% to 2.8%, and Forest Heath, where the count was up 22 at 504, also increasing the rate by 0.1% to 1.3%.

Elsewhere in Essex, smaller increases left the local rate unchanged, including Braintree, up 24 to 1,491 (1.7%), Chelmsford, up 62 to 1,469 (1.4%), Colchester, up 44 to 1,997 (1.8%), Maldon, up 21 to 536 (1.4%) and Uttlesford, up 20 to 395 (0.9%).

Most parts of Suffolk saw the count fall slightly last month, although in no case was the reduction enough to offset the increases of August.

The biggest falls, cutting the local rate by 0.1% in each case, were in Ipswich, down 44 to 2,539 (3.4%), and Waveney, down 29 to 1,941 (2.9%). Smaller falls left the rate unchanged in Babergh, down 22 to 693 (1.4%), Mid Suffolk, down eight to 644 (1.2%), St Edmundsbury, down 26 to 1,051 (1.7%) and Suffolk Coastal, down 25 to 815 (1.2%).

Vicky Redwood, of Capital Economics, forecast that, at the current rate, the number of people claiming the Jobseeker's Allowance would top a million by the end of this year, with total unemployment will rise by 1.5 million to around three million by the end of 2010

Howard Archer, chief UK economist at Global Insight, said the claimant count could reach one million as soon as November and could even reach two million in 2010.

“It seems inevitable that unemployment will rise sharply further over the coming months as near certain recession and depressed business confidence impact,” he said. “Extended very tight credit conditions would also be liable to lead to firms having to shed jobs.”

David Kearn, economic advisor to the British Chambers of Commerce, described yesterday's data as “worse than expected” and said the figures “highlight the deepening recessionary pressures in the economy”.

Graeme Leach, chief economist at the Institute of Directors, added: “Unemployment is heading much higher. We are merely in the foothills at present, with a steep rise ahead.”

TUC general secretary Brendan Barber said: “This is extremely bad news, and these figures do not even show the effects of the bank crash.

“After years when we could take reasonably full employment for granted, we are now in for grim times. This is the next big challenge for Government.”

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