Fall in numbers claiming jobseeker's allowance as Cooper pledges to keep increasing help to get people into jobs

16 December 2009

The Government welcomed news that the number of people claiming unemployment benefit - Jobseeker’s Allowance (JSA) - has fallen for the first time in 21 months.

Ministers said the figures showed that policies to help people back to work were keeping unemployment much lower than in previous recessions. But with unemployment expected to keep rising in the New Year, Work and Pensions Secretary Yvette Cooper pledged to keep increasing help for the unemployed.

Today’s employment figures published by the Office for National Statistics show:

• Number of people claiming JSA fell by 6,300 on the month to 1.63 million (5pc compared to around 10pc in the 80s and 90s)
• The number of young people claiming JSA fell very slightly by 300 on the month.
• ILO unemployment rose by 21,000 on the quarter to 2.49 million (7.9%).
• The number of young people classed as ILO unemployed rose by 6,000 on the quarter to 952,000, however 276,000 of them are students in full time education.
• Excluding full time students, the number of young people ILO unemployed fell by 9,000 to 676,000
• The number of people in work has increased by 53,000 on the quarter.

Other signs that the labour market has strengthened include a small increase in the number of vacancies of 1,000 over the quarter and 18,000 over the month and a small drop of 1,000 in the number of people economically inactive despite a 75,000 increase in the number of students in the inactive group.

The figures also demonstrate the impact of government policy to increase education and training places for young people as the number in full time education has gone up by nearly 150,000 on the quarter.

Secretary of State for Work and Pensions Yvette Cooper said:

“It is encouraging that there are more people in jobs as we get near to Christmas, and also that so many more young people have been helped. Government action is keeping unemployment much lower than in previous recessions.

But it is still tough for a lot of people and we still expect unemployment to increase again in the New Year. So we are determined to do more, supporting a total of 400,000 extra youth opportunities over the next 18 months."

Ministers are concerned that in the 80s and 90s unemployment continued to rise for a long time after the recession ended and they are determined unemployment should come down further and faster this time. They believe the figures show they are right to press ahead with the radical reforms announced in yesterday’s White Paper Building Britain’s Recovery: Achieving Full Employment.

In Parliament yesterday Yvette Cooper confirmed that from January everyone under 25 will be guaranteed a job, training or work experience after six months on unemployment benefit, providing 100,000 extra youth opportunities on top of 300,000 already announced.

To ensure work is always the best financial option yesterday’s White Paper also set out that every person on benefit for at least six months, whatever their age, would be at least £40 per week better off when moving into work.

As part of the Government’s continued support for young people it unveiled the next 2,800 jobs to be created for the young and long term unemployed through the Future Jobs Fund – bringing to 98,000 the total number of jobs announced through the Fund so far.

Employment Minister Jim Knight said:

“Today I am pleased to announce that a further 2,800 jobs will be created for unemployed young people - including youth workers, events managers, IT repairers, medical laboratory assistants and energy specialists. This brings the total number of Future Jobs Fund jobs created so far to 98,000.”

”Government is working with the public, private and voluntary sectors to create these job opportunities as part of our Backing Young Britain campaign – helping young people get a foot on the career ladder and ensuring no one is written off.”

Notes to Editors:

Background to labour market statistics: December 2009

This month’s Labour Force Survey covers August 2009 to October 2009. The claimant count and Jobcentre Plus vacancy count dates were 12^th and 6^th November respectively.

The number of people in work rose this quarter

• 28.9 million people were in work in August to October.
• the employment level in August-October was 53 thousand higher than the previous quarter, but still 432 thousand lower than in the same quarter last year.
• the employment rate is 72.5%, unchanged on the quarter and down 1.7 percentage points on the year
• Number of workforce jobs is 30.9 million in September 2009, down 127 thousand on the quarter and 649 thousand on the year.  ONS sees LFS employment as the best guide to short-term trends, and workforce jobs as providing the most reliable breakdown by industry.

The number of people claiming JSA has fallen this month

• claimant unemployment was 1,626.2 thousand in November 2009, down 6.3 thousand on the level in October, but up 534.7 thousand on the year.
• the claimant unemployment rate, at 5.0%, is unchanged on the month and up 1.6 percentage points on the year.
• inflows to JSA were 331.1 thousand in November, down 23.1 thousand on the month and up 29.6 thousand on the year. The number of people leaving JSA increased to 336.5 thousand, up 3.3 thousand on the month and up 110 thousand on the year.
• in the year to May 2009, the number of people claiming incapacity benefits rose by 25,600 to 2.62 million.  More recent provisional estimates suggest that there were 2.63 million claimants in October 2009, unchanged on the month but up slightly from the level a few months ago.
• in the year to May 2009, the number receiving lone parent benefits fell 18,100 to 720,500.  Provisional figures for October 2009 suggest a continued downward trend in the number of lone parents on benefit (driven by the recent conditionality reforms).

ILO unemployment has risen this quarter

• 2.49 million people were ILO unemployed in the August to October quarter, up by 21 thousand on the May to July period and up 608 thousand on the same quarter last year.
• the ILO unemployment rate is 7.9%, unchanged on the quarter and up 1.9 percentage points on the year.

The number of 18-24 year olds who are unemployed has increased:

• 757 thousand 18-24 year olds were ILO unemployed in the August to October quarter, up by 26 thousand on the May to July period and up 161 thousand on the same quarter last year.
• Of the 952 thousand ILO unemployed aged 16-24, 276 thousand are in full time education.
• The number of unemployed under 25s in full-time education rose by 15,000 this quarter, but the number unemployed and not in full-time education fell by 9,000.
• There were 495.8 thousand 18-24 year olds claiming JSA in November, down by 300 on the level in October and up by 157.5 thousand on the year.

The level of economic inactivity is down on the quarter and up on the year

• the economic inactivity level is 7.9 million, down one thousand on the quarter and up 96 thousand on the year.
• the economic inactivity rate is 21%, unchanged on the quarter and up 0.2 percentage points on the year.
• excluding students, inactivity as a proportion of the working age population is 15.2%, down 0.2 points on the quarter and down 0.3 percentage points over the last year.

There are still many vacancies available, and the number of redundancies has fallen back this quarter:

• There were 191 thousand redundancies in August to October, down 42 thousand on the previous quarter and up 12 thousand on the previous year.
• ONS’s vacancy survey estimates an average of 432 thousand unfilled vacancies in the three months to November 2009, up a thousand on the quarter and down 124 thousand on the year.
• In the last month Jobcentre Plus has taken on average over 10,000 new vacancies every working day and many more come up through other recruitment channels

Earnings growth in the year to October was 1.5%, up 0.1 percentage points from the September figure:

• excluding bonuses, average earnings growth was 1.7%, unchanged from the September figure.

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