The latest labour market figures were published by the Office for National Statistics yesterday and make for good news for the Government, with the unemployment rate down to 6.6%, its lowest level since 2008. What is more, the latest quarterly rise of 345,000 more people in employment has been mainly attributed to people in full-time employment, thus quashing previous arguments that most of the good news around recent employment statistics were based on people moving into self-employment and suggesting that the jobs market is beginning to show some stability. The number of people claiming Jobseeker’s Allowance (JSA) also fell by 27,400 – the nineteenth consecutive month that this figure has fallen.
The claimant count should still be taken with a pinch of salt, however, given the Government’s efforts to increase benefits sanctions on claimants not fulfilling their end of the jobseeker bargain. The Department for Work and Pensions has often been accused of publishing misleading statistics to justify its own policies, and one way to confirm whether the fall in the claimant count is due in larger part to benefits sanctions could be for the Department to commission an independent analysis of the reasons behind the fall in JSA claimants.
If the upturn in employment continues throughout the next 12 months, this will obviously have a positive effect on the Conservatives as voters begin to feel the effects of the economic upturn both in their employment prospects and their pay packets, and one would expect the electorate’s support for the Government’s macroeconomic policies to continue to rise. But, the issue of wages does continue to bug the Government, as the annual earnings growth sank to 0.7% in the previous quarter, down from 1.7% in the previous three months. Whilst most economists believe it’s only a matter of time before wages begin to rise alongside the number of people in employment, Ed Miliband has to find a way to extend his cost of living narrative as this measure takes time to build up, with all signs pointing towards voter fatigue with the argument put forward that the recovery is not being felt by everybody.
In more good news, youth unemployment is down 2.1% on last year, with the number of people unemployed for over 12 months having decreased by 37,000, suggesting that the Government’s oft-criticised employment programmes such as the Work Programme and the Youth Contract are beginning to show long-term results for both jobseekers and the taxpayer.