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Unemployment up, vacancies down, but private sector sees wage increases, says ONS

David Woods , 17 Aug 2011

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The unemployment rate for the three months to June 2011 was 7.9%, up 0.1% on the previous quarter, according to figures from the Office of National Statistics, published this morning.

The total number of unemployed people in the UK increased by 38,000 over the quarter to reach 2.49 million. The number of people unemployed for up to six months increased by 66,000 over the quarter to reach 1.23 million. This is the largest quarterly increase in this series since the three months to June 2009.

The number of unemployed men increased by 18,000 on the quarter to reach 1.45 million. The number of unemployed women increased by 21,000 on the quarter to reach 1.05 million, the highest figure since the three months to May 1988. For the three months to June 2011, the employment rate for those aged from 16 to 64 was 70.7%, unchanged on the quarter. The number of people in employment aged 16 and over increased by 25,000 on the quarter and by 251,000 on the year to reach 29.27 million.

The number of people in employment is 307,000 lower than the pre-recession peak of 29.57 million recorded for the three months to May 2008. The number of employees and self-employed people working part-time because they could not find a full-time job increased by 83,000 on the quarter to reach 1.26 million, the highest figure since comparable records began in 1992.

The inactivity rate for those aged from 16 to 64 for the three months to June 2011 was 23.2%, down 0.1 on the quarter. The number of economically inactive people aged from 16 to 64 fell by 23,000 over the quarter to reach 9.30 million. There were 1.56 million people claiming Jobseeker's Allowance (JSA) in July 2011, up 37,100 on June. This is the largest monthly increase in this series since May 2009.

The number of men claiming JSA increased by 21,500 to reach 1.05 million and the number of women claimants increased by 15,600 to reach 512,700, the highest figure since April 1996. In the three months to June 2011, 154,000 people had become redundant in the three months before the Labour Force Survey interviews, up 32,000 over the quarter. This increase in redundancies occurred mainly among women. In the three months to July 2011, there were 449,000 vacancies, down 22,000 over the quarter.

The total number of vacancies is the lowest since the three months to November 2009. The whole economy earnings annual growth rate for total pay (including bonuses) was 2.6% for the three months to June 2011, up from 2.3% for the three months to May. The whole economy earnings annual growth rate for regular pay (excluding bonuses) was 2.2% for the three months to June 2011, up from 2.1% for the three months to May. These increases in the growth rates for total pay and regular pay were mainly driven by the private sector.

Commenting on the figures, John Salt, director at recruitment website Totaljobs, said: "Following the recent decline in output in the UK manufacturing industry, the rise in unemployment, unfortunately, does not come as a major surprise. This is worrying for young people, considering there is another wave of graduates and school-leavers entering the jobs market at this time of year. More generally, the economy is still faltering, with commodity costs rising, which is damaging consumer confidence. This in turn will continue to have a knock-on effect as the travel and retail markets are particularly suffering from lower than expected consumer spending. Therefore, they are unable to grow and offer as many jobs."

 

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Odd interpretation

Rachel Owlglass 17 Aug 2011

Surely the increase in unemployment is a result of people moving from inactivity to job seeking since the inactivity rate went down a complementary 0.1. This could mean a number of things, not all bad.

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