Comment on the latest ONS labour market statistics
Comment on the latest ONS labour market statistics
Commenting on todays labour market statistics, Ian Brinkley, associate director at The Work Foundation, said:
Todays figures suggest that we are staving off the much-feared work crunch. With the continued contraction of the GDP, we would have expected a larger contraction in the labour market at this stage. However, the statistics appear to indicate that unemployment will peak significantly below the 3 million level that the government is planning for. Good news certainly, but we still have a long way to go before we can be sure recovery is robustly established.
For many especially the young and those in full time jobs in the private sector there are still many months of job loss and insecurity to come. Surprisingly, job losses for women outstripped those for men comparing the three months to September with the previous three months. Full-time employee employment for women was especially weak. Employment for young people (under 25s) is also still falling and full-time employee employment is still falling.
The overall stability in employment has been supported by strong growth in part-time work (dominated by women), which is typical of previous recessions and self-employment is holding up much better than expected. In the 1990s recession self-employment suffered very big losses. In this recession the number of self-employed has hardly changed.
Redundancies and job losses will continue across many industry sectors and in many regions for months to come. However, given todays figures, which suggest the labour market is close to the bottom, this would be a much better performance than in previous recessions.
Why is the labour market doing better than expected? Our evidence shows that employers are much more reluctant to lay workers off than in the last recession despite bigger falls in GDP,. This reflects the investment in skills they have made and awareness at how quickly todays labour market surplus can quickly turn into a labour market shortage. Additionally, wage flexibility (where employers lower wages rather than shed as many people as they would otherwise have done) must also have played a part. Average earnings excluding bonuses in private services have fallen to an exceptionally low annual growth rate of 1.6 per cent comparing the three months to September to the previous three months. Hours flexibility where employers cut hours to save some jobs has also have had a role, but it is harder to demonstrate how significant it is from the aggregate figures.
REC responds to latest ONS unemployment figures
Figures released by the Office of National Statistics today show another rise in unemployment in the three month period to September. However, the rise of 30,000 was the smallest since May last year.
The number of people who are unemployed is now 2.46 million while the youth unemployment rate went up by 15,000 with 943,000 18 to 24 year olds now seeking work.
Commenting on the latest jobs figures, Tom Hadley, the RECs Director of External Relations said: The latest figures fit with the feedback from professional recruiters and with recent data showing positive signs for the UK jobs market. The REC's own research shows that the demand for staff is higher than at any other time in the past two years and there has been an upturn in employer confidence in most sectors".
We believe that unemployment wont hit the three million mark forecast for next year, although there are concerns over how the anticipated squeeze on job opportunities in the public sector could counteract any upturn in the private sector.
Practical guidance and support for job-seekers will remain crucial. We must build on the progress that has been made in terms of co-operation between private sector recruitment agencies and the public sector employment service if we are to continue to see unemployment slow."
CBI REACTION TO UNEMPLOYMENT FIGURES
Commenting on the official unemployment figures today (Wednesday), John Cridland, CBI Deputy Director-General, said:
"It is encouraging that todays figures are not quite as bad as many predicted. However, we expect unemployment will keep rising, and peak next Spring.
"The record rate of joblessness among 16 to 25-year-olds continues to be a major concern. The Government must act fast to prevent a generation of young people being scarred by unemployment. Funds should be targeted at creating apprenticeships, and supporting employers that do so during difficult times."
Why rise in unemployment is lower than expected more part-time jobs for women and a surge in number of young people staying on in education
Dr John Philpott, Chief Economist at the Chartered Institute of Personnel and Development (CIPD), comments as follows on official labour market statistics published earlier today by the Office for National Statistics (ONS):
UK unemployment is continuing to rise but at a much slower pace than earlier in the year. While this is not unexpected the fact that the unemployment total remained below 2.5 million in the quarter ending in September is encouraging. However, the relative improvement should not be interpreted as evidence that the labour market is returning to health, with male unemployment and long-term unemployment continuing to rise and youth unemployment now at a record rate despite a surge in the number of young people staying on in education to avoid the dole.
Unemployment remained below 2.5 million in the three months to September primarily because there was a rise in part-time employment, temporary employment and contract working, the latter boosting self-employment. This more than offset a continued marked deterioration in full-time jobs for employees. Such a pattern is common in a labour market where overall demand for staff is weak and as the Bank of England reiterated today in its latest quarterly Inflation Report - the economic outlook uncertain, with the road to recovery likely to be slow. At such times employers who need to recruit remain wary of hiring full-time staff and it is significant that todays ONS figures do not show an improvement in the level of job vacancies. This pattern is also normally accompanied by a high rate of involuntary part-time working there are now almost 1 million people working part-time because they cant find a full-time job.
Women continue to be the main beneficiaries of a labour market where opportunities for part-time employment are increasing, while men lose out as full-time jobs are being lost. As a result the CIPD expects the rate of male unemployment to rise well above 10% in 2010, with the proportion of men in work set to fall to a record low.
The current pattern of demand for labour is also doing nothing to ease the plight of young people. The latest quarter saw a further large fall in the number of under-25s in work, with the unemployment rate for 18-24 year olds now at a record high. There is little consolation in the fact that the number of unemployed young people remained below 1 million. This is explained by a quarterly surge in the number of young people classed as economically inactive, which the ONS figures indicate is mainly due to more young people staying on at school or college, almost certainly as an alternative to the dole.
Association of Graduate Recruiters responds to latest youth unemployment figures
? Youth unemployment rises to 19.8% - a record high
Carl Gilleard, Chief Executive of the Association of Graduate Recruiters, said: Todays unemployment figures are a major disappointment. We know that there are far fewer graduate vacancies this year and that the situation for graduates is tough. However, it is crucial recent graduates do not lose heart and use any time without employment productively. We know employers continue to place real value on a university degree.
It is still too early to say whether we are likely to see an improvement in 2010 but there is optimism amongst graduate recruiters that the situation should start to ease somewhat. We saw one in four graduate vacancies disappear this year and it will take time before 2008 levels are restored.
AGR is supporting the Governments Backing Young Britain campaign which is calling on all employers to reaffirm their commitment to giving young people new employment opportunities.