Unemployment fell and employment rose in today’s labour market statistics, and most of the growth is accounted for by full-time employee jobs. But is it a blip?
Unemployment fell and employment rose in today’s labour market statistics (pdf), and most of the growth is accounted for by full-time employee jobs. But is it a blip?
There were 29,233,000 people in employment during the three months from December to February, an employment rate of 70.7 per cent:
• Compared with September to November, this was an increase of 143,000 and 0.2 points;
• Compared with last month’s figures (which covered November to January), there was a 76,000 increase in the employment level and a 0.2 point increase in the employment rate.
Employment is now at its highest level since January 2009; since the start of the recession, only two months have seen a higher month-on-month increase.
ILO unemployment, at 2.48 million, was 17,000 down on the previous quarter; this is the fourth largest fall since the start of the recession. The unemployment rate, 7.8 per cent, was 0.1 points down on the previous quarter.
The number of economically inactive working age people fell by 71,000 and the number of economically inactive people who said they wanted a job by 9,000.
All too often in the recent past, there has been a worm at the heart of good employment results: increases have been in “atypical” work – self-employment, part-time and temporary jobs.
That has not been the case this month:
• Compared with the previous quarter, the number of employees is up 140,000 while the number self-employed is only up 12,000;
• The number of unpaid family workers is down 2,000;
• The number working full-time is up 140,000, but the number working part-time is down 58,000.
The figures for involuntary atypical work are a bit more mixed but still reasonable overall: the number working part-time jobs because they couldn’t find full-time ones is up 12,000, but the number working in temporary jobs because they couldn’t get permanent ones is down 18,000.
These are good results, but many reactions have been sour and negative.
The Guardian, Financial Times and Telegraph have all run round-ups of reactions from City economists and others and easily the most frequently used word is “however”. Even Chris Grayling, who doesn’t normally undersell the jobs results, went no further than to call them:
“…a small step in the right direction.”
And yet the indicators of employers’ recruitment intentions have been pointing in a positive direction. The Report on Jobs published by Markit and the Recruitment and Employment Confederation has been showing confident recruitment since the New Year.
The April edition says:
“Permanent staff vacancies rose at the fastest pace since April 2010, while temporary/contract staff vacancies increased at the sharpest rate since July 2007.”
So why the long faces?
Of course, there’s plenty of reasons for believing that jobs growth in the private sector won’t fully compensate for public sector job losses. Inflation is running at more than twice the 2.0 per cent average growth rate for weekly earnings reported in today’s figures, making forecasts that UK household disposable income will fall by 2 per cent this year look entirely reasonable. And if domestic demand looks weak, our largest export markets – as Will Straw has reported – don’t look particularly strong.
But the official line has been that the only people who think these downside risks outweigh the upside are the usual suspects. And that’s the significance of today’s reactions. The fact remains that if the commentariat were more confident about the UK’s macro-economic prospects, they would have given today’s results a much more positive spin.
It’s a sign that, at least in the short term, no one is particularly confident about this country’s future.
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