Business World

Saturday 29 April 2017

UK’s sluggish economy takes its toll on jobs market

Jamie Grierson

Britain's sluggish economic recovery is taking its toll on the labour market, official figures showed today, as unemployment unexpectedly rose for the first time in six months.

The country's jobless rate stood at 2.49 million or 7.9pc between April and June, the Office for National Statistics said, after the total number of unemployed increased by 38,000.



The increase was the largest since May 2009 and the first since January, while economists had expected a fall of around 10,000.



Within the figures, the number of unemployed women hit levels not seen in more than 23 years, while youth unemployment covering the ages between 16 and 24 moved closer to the politically sensitive one million marker at 949,000 or 20.2pc, up 0.2pc from the three months to March.



Elsewhere, the number of people claiming Jobseeker's Allowance (JSA) showed the biggest monthly rise in more than two years, increasing by 37,100 to 1.56 million people.



The figures prompted calls for Chancellor George Osborne to reconsider his tough programme of public sector spending cuts - which includes hundreds of thousands of job losses across the UK.



The Chancellor is banking on a healthy private sector to pick up the slack in the economy but recent figures showing sluggish 0.2% growth in the second quarter have raised fears over the strength of the recovery.



Dave Prentis, general secretary of the public service trade union Unison, said the Government's "savage" cuts have ended opportunities in the public sector and the private sector is struggling to withstand the economic downturn.



He said: "The Government's economic strategy is in tatters. They need to stop the cuts and restore hope by planning for growth."



Stephen Timms, Labour's shadow employment minister said the Government was creating a vicious circle by cutting "too far and too fast".



The Chancellor admitted the figures were disappointing but not "entirely unexpected".



He said: "There is some good news that employment, those in work, is still going up. We are creating jobs in this economy as well as jobs being lost."



Average earnings increased by 2.6pc in the year to June, up by 0.3pc over the previous month.



While this was the largest rise since April last year, the increase in average wages was driven by a bumper period for private sector bonuses and still falls far behind the high rate of inflation, which stood at 4.2pc in June and increased to 4.4pc in July.

Independent News Service

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