Job figures are horrendous but hardly a surprise

This was always an ideological attack on the state and the young are going to have to pay.

The ONS data release on the labour market this morning was horrendous. Unemployment jumped to 8.1 per cent, up 0.4 per cent on the quarter. The total number of unemployed hit 2.57 million, which is the largest quarterly increase since the three months to July 2009. Nearly 900,000 have been unemployed for at least a year and 425,000 for at least two years. The unemployment rate is now in double digits in the north east (11.3 per cent) and in London (10 per cent).

The number of people in employment aged 16 and over fell by 178,000 on the quarter and by 47,000 on the year to reach 29.10 million. This is the largest quarterly fall in the number of people in employment since the three months to July 2009.

The number of people working part-time fell by 175,000 over the quarter to reach 7.78 million. This is the largest quarterly fall in the number of part-time workers since comparable records began in 1992. Inactivity was also up and wage growth remains benign.

Most worrying was the rise in youth unemployment, which is now at 991,000. Next month, it surely will hit the million mark, as the cohort who left schools, colleges and universities fail to find jobs. Plus, of the 17,000 increase in the claimant count, 9,900 was among 18-to-24-year-olds.

The youth unemployment rate was 21.3 per cent over the three months between June and August 2011, an increase of 1.6 per cent on the previous quarter. Worst of all, a quarter of a million youngsters under the age of 25 have been unemployed for at least a year. Long spells of unemployment while young can create permanent scars.

The rise in youth unemployment is hardly a surprise, given the government abolished the Future Jobs Fund and the Educational Maintenance Allowance and reduced the number of university places. This coalition appears to be dead set on creating a lost generation. I first started warning that this was coming in 2009 and the Labour government responded and successfully got youth unemployment down, so the blame for the rise rests entirely at the coalition's door.

Interestingly, the ONS also reports an alternative measure of youth unemployment. This measure, which was introduced in its April 2011 data release, measures the youth unemployment rate "excluding people in full-time education". According to this measure, there were 721,000 unemployed 16-to-24-year-olds between June and August 2011.

This alternative measure of youth unemployment was introduced by ONS back in Spring 2011 in response to pressure from the Secretary of State for Work and Pensions, Iain Duncan Smith, who argued that this was the most appropriate measure to focus on. Youth unemployment among 16-to-24-year-olds increased by 74,000; the number of unemployed who were not in full-time education increased by 78,000.

Yes, that's right; it increased by 78,000. Unsurprisingly, we have heard little on this measure today.

In response, the Employment Minister, Chris Grayling, said:

It is clear that we are seeing the effect of the international economic crisis on the UK labour market. That's why, last week, we announced the right-to-buy housing scheme to support growth and today we are offering more support for jobseekers as sector-based work academies come on stream, combining real training, work experience and a guaranteed interview. Our new work programme is now up and running and offers people who have lost their jobs flexible, tailored support to get back into jobs and stay there.

I guess Grayling has to blame somebody but his comments are not credible. Unemployment is rising because of the government's failed austerity programme, plus a front-loaded public-sector job cull. Take responsibility -- tailored support doesn't work when there aren't any jobs. Guaranteed interviews will not work when, according to your data, there are 2.5 million unemployed and only 500,000 vacancies.

The work programme is already an expensive failure because there is insufficient demand in the economy, simple as that. Feeble excuses don't wash.

This inept coalition has no strategy for jobs or growth and its austerity plan is lowering growth fast and destroying jobs, as I have been warning for a while. This is as good as it gets, because unemployment is expected to rise inexorably from here for many more months and, based on current policies, it is hard to see where it stops.

George Osborne and his team believed in expansionary fiscal contractions, which mean that cuts in public spending allow the private sector to blossom. There was no believable empirical evidence to support such a contention and it hasn't worked.

I understand from my sources that cabinet members are close to panic as they have no idea what to do now -- the slowing economy has taken them entirely by surprise.

This was always an ideological attack on the state and the young are the ones who are going to have to pay.

David Blanchflower is economics editor of the New Statesman and professor of economics at Dartmouth College, New Hampshire

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Has Brexit, like indyref, changed the political axis to Leave vs Remain?

In Scotland, a referendum changed the debate. 

Not that long ago, politics in Scotland seemed to follow a familiar left-right divide. It was a Labour stronghold, and the fact there was only one Tory MP left seemed only to burnish its left-wing credentials. In the Scottish Parliament, too, the Labour narrative dominated.

Even when the Scottish National Party captured Holyrood, this left-right split was still taken for granted (the SNP were still, at that point, doing a good impression of becoming a centrist replacement for the Tories). 

But then came the Scottish referendum, and a Yes campaign that captured the imagination of not only SNP members, but Labour voters, and Greens. Meanwhile, sceptical No voters on both left and right found themselves in an uneasy coalition.

Labour backed the winning side, but ended up the biggest losers. While Ruth Davidson rebranded the Scottish Conservatives as the pro-union party, and Nicola Sturgeon put the SNP in touch with the wider left-wing Yes movement, Kezia Dugdale has been caught in the middle. The party lost all but one MPs in 2015. 

“That is the axis – independence,” Daniel Johnson, a Labour MSP who bucked the trend and won Edinburgh Southern in the 2016 Scottish parliamentary elections, told me in August. “We have to move it on from there. But, by default, that is what it will be.” I heard similar sentiments from Labour campaigners, exhausted after months and years of campaigning with little to show for it. 

Now, after another referendum, are we seeing a similar axis emerge in the UK between Remain and Leave? Just over a year ago, Lib Dem MPs were booted out of constituencies across the land. Now, a Lib Dem, Sarah Olney, has defeated the Brexiteer incumbent, Zac Goldsmith. The result is already being cheered as a victory for the coalition against hard Brexit.

Certainly, her support cut across party lines. She received the support of the Greens, which didn’t stand a candidate and, more crucially, many Labour and Tory voters.

There are important differences. The SNP, on the losing side of the Scottish referendum, nevertheless had a disciplined party, a high profile leader and a track record of centre-left government. Indeed, New Labour supporters often mutter darkly that it has "stolen our clothes". The national party with the clearest message on Remain, the Lib Dems, is by contrast, a diminished outfit after their own devastating defeats in 2015. 

Scotland’s parties also look more politically homogeneous, with Labour, the Lib Dems and the Scottish National Party all offering versions of the centre left. Under Davidson, the Conservatives have targeted the “tenement Tories” with a focus on social mobility and blue-collar traditions. It is unsurprising, then, that for many voters the overwhelming distinction is Yes to independence, or No.

In the UK as a whole, by contrast, the Remain vote is split between  the devolved nations, the metropolitan elites – Exhibit A, Richmond – and young people who may or may not be able to influence the constituency vote. 

If any party can stitch these groups together, it should be Labour. But the party is now locked in internal agonising over Brexit, and the direction of its leadership. Embracing a new axis could open the door to a soft Brexit progressive alliance, but might also mean abandoning Scotland to the SNP, and the North to Leave.

For now, it is ploughing on. Unlike the Greens, it stood a candidate in Richmond. Despite being a well-respected transport expert, he lost with just 3.7 per cent of the vote. Some things, at least, are like Scotland.    

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.