Only half the story…

Statistics released yesterday show that official unemployment in the UK fell by 33,000 in the last quater of 2009 to 2.45million leaving the UK jobless rate at 7.8%. Party politics aside we should all be delighted when we hear that unemployment in the UK has fallen and in normal circumstances I would be, however as is typical of this government behind the official figures lies a much darker reality. Official unemployment may well stand at 2.45million, which is still high for the post war period, but there are many other job market statistics which are not taken in to account and paint a very different picture. For example:

  1. Official figures from the Office for National Statistics show that 8.16 million people are now classed as “economically inactive” which means that they are not able or willing to look for work. Combine this with the official national unemployment rate and Britain has a jobless population of over 10 million. The worst rate since the ONS records began in 1971.
  2. The official figures fail to take in to account the growing New Labour phenomenon; “the underemployed”. These are people who are technically economically active and are in work however they do not work enough hours to meet their economic needs. An example of the “underemployed” could be someone who works 17 hours a week – too much to claim JSA but too little to meet their financial commitments encouraging a culture of debt. Official statistics from the ONS show that nearly 3 million people in the UK are “underemployed” – more than the overnall unemployment rate. Combine this with the total 10 million+ jobless rate and the state of Britains employment market is actually incredibly poor.

Criticism and caution over the government statistics has come in thick and fast with most if not all leading economists warning that the UK employment figures are misleading and the job market is much more fragile than the government care to admit. Dr John Philpott, chief economic adviser at the Chartered Institute of Personnel and Development, said: “The latest unemployment figures show that conditions in the UK labour market remain extremely weak and indicate that talk of the jobless rate having already peaked is premature. Moreover, separate analysis by the ONS showing that 2.8 million UK workers are ‘underemployed’ shows that the headline jobless figures provide only a partial account of the full impact of the recession on the UK workforce.”

Now there will be people out there who will claim that the Conservatives are just making party political points. This is not the case – we are merely stating the facts however uncomfortable they may be, much as we did when Gordon Brown arrogantly declared “we have abolished boom and bust”. It was unpopular to say it then but we told the truth when we said it was impossible to abolish boom and bust or as Margaret Thatcher put it; “you can’t buck the market”. Now in the wake of one of the worst economic recessions ever and with the job market in such a dire state we can ask the question with confidence- who was right? Labour are propping up this economy with borrowed funds meaning it is on borrowed time. Eventually cuts will have to be made, eventually this debt will have to be repaid and eventually we will feel the full force of Labours economic mismanagement.

So yes official unemployment has fallen but as ever with this government the rhetoric defies the reality. We are only being told half the story.

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6 thoughts on “Only half the story…

  1. Add in the 7 million people employed by the state, and the numbers become even scarier. If you take away the young and the retired, only around half of the population is in employment which is contributing to the national economy.

  2. I’m not sure why we’re supposed to care if 7 million people are employed by the state in the context of a discussion on unemployment.

    I would also point out: “The biggest rise in economic inactivity was down to the increase in students, with nearly 100,000 deciding to study in the three months to January”. (Telegraph)

    The 18,000 people who have left the job market to look after children are also still making a positive contribution.

    I’m not sure which rhetoric ‘defies reality’ as you should be aware that Yvette Cooper was fairly cautious over this. And no, debt does not have to be repaid.

  3. I’ve heard from one source (can’t exactly remember where though, lol) that if the government had taken one party’s advice unemployment (officially) would be around 5 million.

  4. It would be amore accurate reflection of the state of the economy Max. Concealing the figures and superficially propping up the economy can only last so long and when the rug is pulled from beneath (as all parties agree it must soon be) the real extent and impact of Labours betrayal will become apparent.

  5. Dan, can you elaborate please? Phrases like ‘Labour’s betrayal’ just make you sound like John Tyndall.

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