The numbers of young and long-term unemployed remain worryingly high

Published on Wednesday, 16 October 2013 12:33
Written by Sinead Fynes Black

Commenting on the latest Labour Market Statistics released today by the Office for National Statistics, CIPD Chief Economist Mark Beatson said:

"Today's headline figures continue the pattern of recent months. Increased confidence in economic growth is feeding through to the labour market. Recruitment is up and the official number of vacancies is at its highest level since the autumn of 2008. The number of people employed grew by 155,000 in the last quarter yet there is no sign yet of increased demand leading to higher wages across the board– indeed, average earnings in August were unchanged from the previous month and the annual growth rate for the last three months is just 0.7%, two percentage points below the current rate of inflation.

"However, the number of people unemployed on the headline measure is hardly moving at the moment. In part this is because the population is growing. The number of people who are inactive has also fallen again, which increases the labour supply, and there are now 63,000 less people inactive because of long-term sickness than there were a year ago. But unemployment does appear to be on the way down; the headline measure is moving very slowly whereas the claimant count fell by 120,000 between June and September.

"Hopefully, some of this difference might be timing – the claimant count is more up to date than the headline measure. But youth unemployment remains stubbornly high, and long term unemployment has only just begun to fall, so there is a real need to step up efforts to ensure our young and long term unemployed aren't left out of the labour market recovery. Employers and government both recognise this. But the need for greater urgency was emphasised by last week's OECD Skills Survey, which reminded us that the UK needs to raise its skill levels across the board to remain competitive – especially for those with weaknesses in literacy and numeracy. These are long-term problems that will not be solved by economic growth alone, but instead threaten to act as a major brake on future long-term growth."

Source: CIPD

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