View all newsletters
Sign up to our newsletters

Support 110 years of independent journalism.

  1. Politics
17 August 2012

Good news on jobs is Labour’s legacy

When the evidence supports it, Labour must not be ashamed to speak up about the things they got right in power.

By Andrew Harrop

This week’s employment statistics offered a rare piece of good news amid the economic gloom. Not for the first time they reveal a paradox of the economic crisis: the number of people in work is “too high” given our dismal GDP figures. No one can be happy with unemployment at 8 per cent, with the tragic social cost to so many families, but it could, and perhaps should, be a whole lot worse.

In the two years since the coalition came to power there has been zero GDP growth while median earnings have risen by just 1.3 per cent against an increase in RPI of 8.3 per cent. But the proportion of the population in work has actually increased – from 70.4 per cent to 71 per cent. What on earth is going on?

One explanation that has often been overlooked is the decline in “economic inactivity” – statistician’s jargon for people who are neither in a job or actively seeking work. The figures released this week show that while unemployment is a jot higher than two years ago the numbers who are inactive has fallen by around 300,000 people. In other words the supply of labour has increased which in turn has a positive influence on the number of jobs in the economy.

This continues a long-trend that began in the early-2000s and is a direct consequence of Labour’s welfare reforms. Compared to a decade ago there are almost 300,000 fewer lone parents and 200,000 disabled people claiming benefits. Unexpectedly the slow but steady improvement has continued even through the slump, due to a combination of changing eligibility requirements, improved support services and a gradual change in expectations. While the latest figures are published on the coalition’s watch, the lag between ideas and implementation means that it is the last government’s policies that must take the credit.

Remarkably, the reduction in the number of “inactive” benefit claimants in the last ten years has been so great that it has entirely cancelled out the recession-induced rise in the numbers on JobSeeker’s Allowance. As a consequence the proportion of 16 to 64 year-olds on out-of-work benefits is today lower than it was in 2002 despite economic meltdown.

Select and enter your email address Your weekly guide to the best writing on ideas, politics, books and culture every Saturday. The best way to sign up for The Saturday Read is via saturdayread.substack.com The New Statesman's quick and essential guide to the news and politics of the day. The best way to sign up for Morning Call is via morningcall.substack.com Our Thursday ideas newsletter, delving into philosophy, criticism, and intellectual history. The best way to sign up for The Salvo is via thesalvo.substack.com Stay up to date with NS events, subscription offers & updates. Weekly analysis of the shift to a new economy from the New Statesman's Spotlight on Policy team. The best way to sign up for The Green Transition is via spotlightonpolicy.substack.com
  • Administration / Office
  • Arts and Culture
  • Board Member
  • Business / Corporate Services
  • Client / Customer Services
  • Communications
  • Construction, Works, Engineering
  • Education, Curriculum and Teaching
  • Environment, Conservation and NRM
  • Facility / Grounds Management and Maintenance
  • Finance Management
  • Health - Medical and Nursing Management
  • HR, Training and Organisational Development
  • Information and Communications Technology
  • Information Services, Statistics, Records, Archives
  • Infrastructure Management - Transport, Utilities
  • Legal Officers and Practitioners
  • Librarians and Library Management
  • Management
  • Marketing
  • OH&S, Risk Management
  • Operations Management
  • Planning, Policy, Strategy
  • Printing, Design, Publishing, Web
  • Projects, Programs and Advisors
  • Property, Assets and Fleet Management
  • Public Relations and Media
  • Purchasing and Procurement
  • Quality Management
  • Science and Technical Research and Development
  • Security and Law Enforcement
  • Service Delivery
  • Sport and Recreation
  • Travel, Accommodation, Tourism
  • Wellbeing, Community / Social Services
Visit our privacy Policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications.
THANK YOU

Yet year-by-year the “welfare scrounger” hysteria has grown, in direct contradiction to the evidence. Perhaps this unexpected labour market triumph has gone ignored, by Left and Right, because it jars so much with received wisdom.  

For Conservatives the success makes for inconvenient reading because it undermines their arguments for savage welfare reforms. And perhaps Labour has given up trying to defend its record because it doesn’t think people are not prepared to listen or believe? When the evidence demands it, Labour must not lose the habit of shouting about the things it got right when in power.

Content from our partners
The promise of prevention
How Labour hopes to make the UK a leader in green energy
Is now the time to rethink health and care for older people? With Age UK

Select and enter your email address Your weekly guide to the best writing on ideas, politics, books and culture every Saturday. The best way to sign up for The Saturday Read is via saturdayread.substack.com The New Statesman's quick and essential guide to the news and politics of the day. The best way to sign up for Morning Call is via morningcall.substack.com Our Thursday ideas newsletter, delving into philosophy, criticism, and intellectual history. The best way to sign up for The Salvo is via thesalvo.substack.com Stay up to date with NS events, subscription offers & updates. Weekly analysis of the shift to a new economy from the New Statesman's Spotlight on Policy team. The best way to sign up for The Green Transition is via spotlightonpolicy.substack.com
  • Administration / Office
  • Arts and Culture
  • Board Member
  • Business / Corporate Services
  • Client / Customer Services
  • Communications
  • Construction, Works, Engineering
  • Education, Curriculum and Teaching
  • Environment, Conservation and NRM
  • Facility / Grounds Management and Maintenance
  • Finance Management
  • Health - Medical and Nursing Management
  • HR, Training and Organisational Development
  • Information and Communications Technology
  • Information Services, Statistics, Records, Archives
  • Infrastructure Management - Transport, Utilities
  • Legal Officers and Practitioners
  • Librarians and Library Management
  • Management
  • Marketing
  • OH&S, Risk Management
  • Operations Management
  • Planning, Policy, Strategy
  • Printing, Design, Publishing, Web
  • Projects, Programs and Advisors
  • Property, Assets and Fleet Management
  • Public Relations and Media
  • Purchasing and Procurement
  • Quality Management
  • Science and Technical Research and Development
  • Security and Law Enforcement
  • Service Delivery
  • Sport and Recreation
  • Travel, Accommodation, Tourism
  • Wellbeing, Community / Social Services
Visit our privacy Policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications.
THANK YOU