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UK unemployment has now reached 2.43 million

The number of unemployed people increased by 220,000 in the March to May quarter to reach 2.43m. This was up by 750,000 on the same three months last year. This is according to figures from the Labour Force Survey (LFS), which uses the International Labour Organisation’s (ILO) approved method of counting unemployment.

 

This shows that the unemployment rate on this measure rose by 0.7 over the previous quarter to reach a rate of 7.8% in the three months to June.

 

The recent trend can be seen in the figure below.

 

Source: ONS

Source: ONS

The alternative measure of calculating unemployment, the claimant count (CC) measures the number of people claiming Jobseeker’s Allowance. This total reached 1.58m in July 2009, which is the highest level recorded since May 1997. This figure is up 24,900 over the previous month and 709,000 up on the year.

 

Other figures show that the number of redundancies in the three months to June was 277,000 which were down 9,000 on the previous quarter but up 150,000 on a year ago.

 

There was also a continued fall in job vacancies. There were 427,000 vacancies in the second quarter of 2009 which is the lowest figure since comparable records began in 2001. This reflected a drop of 26,000 vacancies over the previous quarter and a fall of 203,000 over the same period last year.

 

There was also a decline in the employment rate for people of working age, which was 72.7% in the three months to June 2009, which was down 0.9% on the previous quarter and 2.4% over a year ago.

 

There was also a sharp fall in average earnings which increased by 2.5% in the three months to June on an annual basis, both including and excluding bonuses. The figure which excludes bonuses is now at its lowest level since comparable records began in 2001.

 

One question still to be answered is why the LFS figure is much higher than the CC figure? Whilst the LFS figure gives a jobless rate of 7.8% the CC figure puts it at only 4.9%. This is why on Monday the government launched an urgent enquiry into the discrepancy between the two figures.

 

The answer could be to do with the fact that the LFS is a rolling quarterly figure whereas the CC total is measured on a monthly basis. However, there could be other reasons. It may be that some of those losing their jobs may be expecting to get back quickly into the workforce. As a result they may not want the hassle of signing on, and are happy to use savings or redundancy payments for a short period. Also, some job losses may involve people who were the “second earner” in their family and are living on their partner’s income.

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Posted in Earnings, Employment, unemployment

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