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Press Releases > Comment on the latest labour market statistics

Comment on the latest ONS labour market statistics

Wednesday, 21 April 2010

 

For immediate release: Wednesday 21 April 2010

 

New labour market figures: “Fall in claimant count measure misleading; hasty public sector cuts must be avoided”

 

Commenting on today’s ONS labour market statistics, Ian Brinkley, Associate Director of The Work Foundation said:

 

“There is still no sign of a recovery in the labour market. Employment across all the private sector based industries was either contracting[i] or stagnating. Any growth continues to come from the public sector and this is not sustainable. Until we see firm signs of a private sector led labour market recovery, the new government would be well advised to avoid making big cuts in public sector workforce levels too quickly.

 

“The fall in the claimant count measure is misleading as an indicator of the overall state of employment. The total number of people in work fell substantially comparing the three months December-February with the previous three months and the broader measure of unemployment that takes into account people looking for work who do not claim JSA[ii] went up again.

 

“The number of people of working age classified as “inactive” (not in work or unemployed) also went up but this is not a major worry as it was driven by rising numbers of students.

 

“The threat of public sector job cuts has yet to show up in these numbers. Overall, public sector employment went up slightly in the three months to December[iii] driven by growth in education and the NHS.

 

“The recent weakness in the labour market is due to job losses in traditional service sectors such as distribution and hospitality, with substantial falls in employment for women in part-time jobs. This may well reflect weaker discretionary consumer spending with the recent rise in VAT and as inflation runs well ahead of wage increases, further reducing spending power.”

 

Ends

Notes to editors

  1. Ian Brinkley is available for interviews and briefings.  
  2. The Work Foundation is the leading independent authority on work and its future. It aims to improve the quality of working life and the effectiveness of organisations by equipping leaders, policymakers and opinion-formers with evidence, advice, new thinking and networks. www.theworkfoundation.com.
  3. Please see below for explanatory notes.

 

Media enquiries:

 

Nasreen Memon 020 7976 3507 or 07825 527 036

 


[i] There are two measures of employment. The wider International Labour Organisation (ILO) measure of employment shows a fall of 89,000 comparing the three months December- February 2010 with the previous three months. The alternative measure of Workforce Jobs is less timely but gives details by industry. This measure shows a fall in employment of 119,000 in the three months to December, with 62,000 in distribution and hospitality, 37,000 in production industries such as manufacturing, construction, and energy and water, and 27,000 in transport and communications. Business and financial services employment remained flat. Education, health and public administration went up by 39,000 but this includes some private as well as public service providers.

 

[ii] The ILO definition of unemployment includes all those who looked for work in the past four weeks and were able to start a job in two weeks time. Over the three months to February 2010, the number of people unemployed by this definition went up by 43,000 to just over 2.5 million, taking the ILO unemployment rate up from 7.8% to 8%. In contrast, the number of people claiming JSA related benefits in March fell by 29,000 to just over 1.1 million taking the claimant count unemployment rate down from 4.9% to 4.8%.

 

[iii] Public sector employment as defined by the Office for National Statistics went up by 7,000 overall in the three months to December 2009, but if the publicly controlled banks are excluded, the increase was 25,000. This was driven by increased NHS employment (up by 20,000) and education employment (up by 15,000). There were offsetting cuts in public administration and non-NHS health and social work employment of 10,000. The publicly controlled banks shed 18,000 jobs.