With a lack of jobs available and the state of the current economic climate, it is no surprise then that the nation’s labour market is becoming gloomier. Figures are showing that over the three months to June, unemployment had increased by 38,000. The largest rise since spring 2009 and there is no certainty that these individuals will find jobs anytime soon.
Employers do not need new workers
Chris Crowe, UK economist at Barclays Capital has said that unemployment on the International Labour Organisation (ILO) measure has been edging itself down.
He went on to say that their longer-term understanding of the labour market is that private sector employment growth will not be sufficient in balancing what is happening in the public sector. This is partly because the last recession caused a drop in productivity and so while employers are in a position to expand they do not need new workers to make that happen.
Philip Rush, UK economist at Nomura feels that the rising unemployment as revealed on the Labour Force Survey (LFS) was not due to falling number in employment but it was because people had been changing their status from inactive to unemployed. Figures showed that 38,000 students unsuccessfully sought work, 4,000 long-term sick became better and 7,000 “discouraged” individuals became motivated and encouraged.
Talking about the labour market he said that it was worsening with respect to the decreasing demand by companies looking to add new roles. The number of redundancies have risen especially in the public sector this has been compounded by lower job vacancies which are finding a home at a much lower level.
Scott Corfe, economist at the Centre for Economics and Business Research has stated that the data revealed today will be another source of concern for George Osborne, the Chancellor of the Exchequer. Mr Osborne who is facing increasing pressure to provide measures to instigate growth in the economy once more.