Office for National Statistics shows unemployment has fallen but growth in job numbers is slowing down

According to findings from the Office for National Statistics, the number of job vacancies rose during this quarter by 39,000 to reach 480,000 in the three months to February, though the month-on-month figures were stagnant, indicating some slowing of growth.

The figures also revealed that public-sector employment continued to grow, increasing by 46,000 in the year to the final quarter of 2009. While over the same period some 527,000 jobs were lost in the private sector.

The number of people in employment declined by 54,000, to reach 28.86 million  - with an employment rate of 72.2%, the lowest since November 1996. There was also a rise of 149,000 in the number that are economically inactive. This figure was driven largely by the growth of 98,000 in the number of students. There has also been another increase in the number of inactive people who say they would like work, up by 61,000, and the total now stands at 2.3 million.

But the number of people who have been unemployed for more than a year rose by 61,000 to 687,000.

According to the Institute of Employment Studies, this means employment will only rise very slowly as economic growth picks up. This remains the root cause of the apparently contradictory changes in both the claimant count and the broader unemployment measure from month to month.

John Atkinson, associate director of the Institute for Employment Studies, said: "It is encouraging that unemployment has fallen sharply this month, but the underlying growth in vacancies may be levelling off. As a result, it remains the case that positive changes in one month are likely to be overturned in the next, and it is difficult to escape the conclusion that unemployment is likely to remain high without more sustained and substantial economic growth. It is worrying to note that unemployment has continued to rise among people with longer spells out of work.

"These longer-term changes in the labour market show that under-employment remains very high, with significant and sustained growth in the numbers that would seek work if they felt that it was available for them. This seems likely to continue now that the growth in public-sector employment is expected to dry up."