Latest job figures show further rise in unemployment

Unemployment rose by 118,000 in the three months to November 2011, bringing the total figure to 2.685 million, according to the latest figures released today by the Office for National Statistics (ONS).

The ONS figures show that in the three months to November, 18,000 people gained work, but this was greatly outweighed by the 118,000 who lost their jobs over the same period.

The total figure of 2.685 million is the highest jobless total since 1994. According to the ONS, when broken down by gender this means a rounded male unemployment figure of 1.56 million – the highest since 1995 – and a female rounded unemployment figure of 1.13 million, the highest since 1987.

The outlook for youth unemployment continues to be bleak, with a further drop in employment among those aged between 16 and 24. The number of unemployed young people rose by 52,000 to 1.04 million, 22.3% of that age group.

David Kern, chief economist at the British Chambers of Commerce, said that there were some positives to be found in the figures: “Employment has increased modestly despite the rise in unemployment. This shows the level of inactivity is falling as people return to the labour market and look for work. It is also important to note that more than 300,000 of those aged 16 to 24 are in full-time education seeking work.

“Nevertheless, the situation is difficult and the combined impact of the austerity plan and problems in the eurozone will result in further increases in the jobless total. In our December forecast, we predicted an increase to 2.77 million by the end of this year, but there is now a real possibility the total will be higher. With job losses in the public sector likely to continue, every effort must be made to help the private sector create more jobs,” he continued.

Charles Levy, senior economist at The Work Foundation, agreed that the figures contained some promising signs, but suggested the job market was still a long way from achieving stability: “Today’s labour market statistics offer some tentative signs that the economy was stabilising at the end of last year. In the three months to November, employment actually increased by 18,000. This comes after very high job losses over the summer.

“This will, however, be of little comfort to the millions of workers who are facing the toughest labour market since the start of the recession. Comparing the three months to November last year with the previous three months, unemployment increased by 118,000. The young (16 to 24) and the older (50 to 64) bore the brunt of this. Those in work are also continuing to feel the squeeze as the economy substituted full-time work for part-time, permanent employment for temporary positions and employee jobs for often more precarious self-employment.

“This picture will only improve if we return to strong quarte-on-quarter employment growth.”

Dr John Philpott, chief economic adviser at the Chartered Institute of Personnel and Development (CIPD), agreed that the overall picture was still that of a fragile job market: “The latest jobs data paint a mixed picture, with a smaller rise in unemployment than in the quarter to October, a slight increase in the number of people in work, little change in the number of people claiming jobseeker’s allowance and a small but nonetheless welcome fall in long-term unemployment. But the picture overall remains one of increasing fragility and the jobs situation is set to get much worse in 2012.

“The small rise in employment masks another sharp fall in the number of employees. This is once again partially offset by a rise in self-employment, though, as the CIPD noted earlier today, this consists largely of part-time ‘odd jobbers’ and should be viewed as a sign of labour-market weakness rather than strength. Moreover, employment overall increased only because there were more unpaid family workers and more people employed on government schemes. In total, full-time employment has fallen while part-time employment has increased.

“With total unemployment and youth unemployment still on the up, with growth in average earnings very subdued, and with a region like the North-East now registering a 12% unemployment rate, it’s clear that the UK jobs market is in a very sorry state. It now looks likely that the level of unemployment at the end of 2011 will have reached 2.7 million, which was the CIPD’s forecast this time last year. There is nothing in these latest jobs figures that makes us feel any more optimistic about our forecast for this year, which points to 2.85 million (8.8%) by the end of 2012.”

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