Unemployment Data Reveals Stalling Recovery

Unemployment numbers fell leaving the UK unemployment rate at 7.8%.

Unemployment numbers fell leaving the UK unemployment rate at 7.8%.

Unemployment figures for the UK have been released for the second quarter reporting.  The total fell by 49,000 to 2.46 million, leaving an unemployment rate of 7.8 per cent.  This was the biggest drop in three years.  Within the UK, the unemployment rate fell by 0.3 per cent to 9 per cent in Wales, it fell by 0.2 per cent to 7.7 per cent in England, it fell 0.2 per cent to 6.6 per cent in Northern Ireland, and increased 0.2 per cent to 8.4 per cent in Scotland.

The number of newly employed had the largest quarterly rise since 1989.  The Office for National Statistics (ONS), which released the new unemployment data, said those finding new employment increased by 184,000.

The young adults looking for jobs however did not fair well and neither did the elderly.  The number of 18 to 24 year olds out of work for two years or more rose to 72,000, up 11 per cent from first quarter.  The number of over 50′s that have been out of a job for two years or more rose by more than one fifth compared to last year.

The number of people of all age groups that have been out of work for one year  or more increased by 33,000 to 786,000.  This is the highest figure since 1997.

It was expected that those seeking job benefits would be far less than what was reported.  Some 1.46 million claimed benefits in July which is a decrease of 3,800 against June.  However, the number of those who have been receiving benefits for over a six month period rose by 7,200 to 903,700.

The ONS also reported that the average pay was up by 1.3 per cent compared with last year.

Analysts stayed focus on the small change in those needing unemployment benefits.  This was a signal to many that economic recovery may be stalling.

Vicky Redwood, at Capital Economic, said: “This might be a sign that the slowdown in the wider economic recovery is already spreading to the labour market.  And with sharp public sector job cuts looming, we still think that renewed rises in unemployment lie ahead.”

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