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Unemployment Almost Hits 2 Million

Latest official unemployment figures fall just short of 2 million but quarterly leap in redundancies signals 3 million jobless on the way

Official labour market figures published by the Office for National Statistics (ONS) surprisingly show that UK unemployment didnt top the 2 million mark at the end of 2008. But says John Philpott, Chief Economist at the Chartered Institute of Personnel and Development (CIPD) this apparently positive news is tempered by official confirmation of a big increase in redundancies, which will in due course feed through into the jobless count.

Dr Philpott comments as follows: It was widely expected that todays official figures would have shown there were more than 2 million people unemployed at the end of 2008. It is likely that the published quarterly statistics were still affected by the inclusion of data from the early autumn before the second wave of the credit crunch started to have a big impact on employers recruitment and redundancy plans.

Perhaps even more surprising is that the latest figures on the number of people claiming Jobseekers Allowance increased by a less than expected 73,880 in January, with little monthly change in the number flowing on to the count but an increase in the number flowing off the count. This is especially puzzling when set against a sharp quarterly rise in redundancies and a further fall in the number of vacancies.

Horrendous rise in redundancies
The final quarter redundancies figure of 259,000 is fairly horrendous and suggests that the CIPD forecast of 300,000 redundancies in the first quarter of 2009 will, if anything, turn out to be an underestimate. The normal lag between redundancies being made and people joining the unemployment count also indicates that, whatever comfort might be taken from todays jobless figures, unemployment remains on course to rise above 3 million before the economy recovers.

Men being harder hit than women
Commenting on widespread reports that women are being hit harder than men by the current downturn, Dr Philpott added: There is nothing in these figures to indicate that women are faring less well than men in the economic downturn. More men than women have lost jobs, male unemployment has risen faster than female unemployment, and the redundancy rate has almost doubled for men while having increased by a quarter for women. On current figures if there is a gender bias in this downturn it is firmly against men rather than women.

Responding to these latest ONS figures Tom Hadley REC Director of External Relations says "One priority is to ensure that the increasing number of job-seekers receive appropriate support. The fact that the higher end of the jobs market has been equally impacted creates specific challenges and makes it even more important for the private sector recruitment industry to work in partnership with Jobcentre Plus. This will ensure that specific guidance and jobs are provided to categories of workers who would not naturally gravitate towards Jobcentres.

Other priorities include promoting the 'stepping stone' opportunities that temporary and interim work can provide and ensuring that new employment regulations do not hinder the viability of this kind of flexible working outlet. In. Particular, the Government must delay plans to add VAT to temporary work services in a number of sectors from next April and must ensure that UK implementation of the EU Agency Workers Directive avoids adding the kind of unecessary. cost and administration that could ultimately impact on flexible work opportunities for jobseekers."


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