Unemployment falls

Unemployment down by 35,000, 0.1 percentage point, and employment rises by 53,000, also 0.1 point.

By Alex Hern Published 18 April 2012

Miss Dynamite and Charlie Simpson stand in line outside a job centre

Musicians Miss Dynamite (5th L) and Charlie Simpson (6th L) join unemployed young people as they stand in line outside a job centre in central London (Getty)

The unemployment figures are out, and it looks like things have stopped getting worse. Whether this is a temporary halt in a longer term decline, or the start of an improvement, is something that we will have to wait to see.

The headline indicators are good news, though still far closer to a stabilisation than an actual improvement in the situation. The employment rate was 70.4 per cent, up 0.1, or 53,000 people, in the three months to February. The unemployment rate has fallen 0.1 point in the quarter, and now stands at 8.3 per cent. There are now 2.65 million unemployed people, 35,000 fewer than in November, and the first quarterly fall since May 2011.

Digging deeper, some worrying trends reveal themselves. The fall in unemployment was almost entirely due to a rise in part-time work. Full-time employment rose by just 3,000 for employees, and full-time self employment actually fell by 13,000. Meanwhile, the total number of people working part time rose by 80,000 people.

The stats also break down the reasons why people are working part-time, and reveals that 1.4 million of the 7.8 million part-time employees are only doing so because they cannot get a full time job, an increase of 89,000 people.

Similar stories were seen in the figures for temporary employment. 22,000 more people were employed temporarily in the three months leading to February, a 1.4 per cent increase, and again, a large number were only working temporarily because they could not find a permanent job: 627,000, just under 40 per cent of all temporary employees, a 6.4 per cent increase.

Clearly, these increases are good; it is better to be employed, even temporarily, than not at all. But there has been a fear of an under-employment crisis bubbling under the surface for some time now, and today's releases reinforce that narrative.

Another narrative they reinforce is anti-immigration. As Faisal Islam pointed out, year-on-year, the number of jobs lost by UK nationals is exactly the same as the number gained by non-UK nationals – 166,000. This is, it should be made clear, a coincedence. Nonetheless, it is too perfect a coincedence not to be used by those who want to push the narrative that people are moving here and taking British jobs from British workers.

Finally, Chris Dillow noticed the disconnection between total hours worked, which rose by 1.4 per cent, and British GDP, which is stagnating. This implies that productivity is falling, meaning that workers have to do more to produce the same output. This is concerning news for the longer term recovery; it could mean that even returning to the pre-crisis levels of employment and investment won't bring GDP growth back to trend levels.

Regardless of what is buried in the reports, though, the headline figures are what matter for the government. This is the first data release in months that won't have Chris Grayling hanging his head.

4 comments

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Thu, 2012-04-19 00:17 — Indu Pendent

We need to get over the British belief that a job is a god given birth right.
The last government left the economy in a dreadful state and and allowed UK industry to decline at its fastest rate since the 1970s . That why now there arent any jobs -as the state is being shrunk it is revealing the true state of thedepleted underlying economy .