UK unemployment: Jobs up, pay down

Job centre The good news on youth unemployment seems to be genuinely good

Jobs prospects for young people are starting to look a bit healthier - though the average pay packet is not. Those are two clear conclusions you can draw from the latest labour market statistics. The other parts of the story, whether it's joblessness or employment, are a bit murkier.

Take the murky stuff first: that 82,000 fall in the broader measure of unemployment certainly sounds good. In fact, it's the largest quarterly fall in more than a decade. But that headline change comes from comparing joblessness in the three months to October with the same figure for the three months to July.

If you compare this latest three-month figure with the one published last month (i.e. the three months to September), the number out of work has barely changed at all - in fact it has fallen by just 4,000.

You can say something similar about employment. It's impressive, to say the least, that there are now half a million more people in work than a year ago, with the creation of 600,000 jobs in the private sector more than offsetting the jobs lost in government. The trend, though, is a little discouraging: the 40,000 rise in employment in the three months to October is the smallest since the start of the year.

However, the good news on youth unemployment seems to be genuinely good.

As usual, there is a lot going on behind the 70,000 fall in the number of unemployed 18 to 24-year-olds. For example, I was initially worried to see that economic inactivity among that group, overall, had also risen in the three months to October, by 45,000, while employment had only risen by 11,000.

But when you dig deeper, you can see that the rise in so-called inactivity is more than accounted for by a rise in inactivity among 18 to 24-year-olds who are in full-time education. (The factor that always makes these numbers such a minefield.)

Employment among young people not in full-time education went up by 55,000 in those three months, while the number who were technically inactive actually fell slightly.

So, things seem to be getting better for young people looking for work who are not full-time students - or at least they are not getting worse.

Alas, the same cannot be said for average earnings, which have actually now fallen even further behind inflation in October with average annual growth of just 1.3% - less than half the rate of inflation.

Real earnings have now been falling since the summer of 2010. This was supposed to be the year when the squeeze would ease. But we're running out of time for that particular new year prediction to come true.

Stephanie Flanders, Economics editor Article written by Stephanie Flanders Stephanie Flanders Former economics editor

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  • rate this

    Comment number 106.

    Jobs up, pay down!

    Look behind the headline figures you will see that total weekly hours worked is pretty much back to 950million where it was in 2007

    The unfortunate reality is that since 2007 the Developing world has got a lot richer and are competing to buy the same food, petrol, gas and other essentials

    We in the Developed world are going to have to ‘grow’ just to stand still.

  • rate this

    Comment number 105.

    Did you know that after six months the unemployed are no longer paid unemployment benefits. The receive nothing/zero/zilch.
    They just drop off the statistics chart.

  • rate this

    Comment number 104.

    #28 JfH: I am not surprised productivity is falling, it is almost basic economics. To expand production companies normally need to utilise more capital, more labour or a bit of both. When, as is the case currently, capital is in short supply (no bank lending and companies unwilling to invest), the inevitable consequence is growth requires more labour. More labour is less productive

  • rate this

    Comment number 103.

    It doesn't automatically mean the Government can take credit for it [equally they are not always to blame for figures going the other way].
    And it's highly regional: in London we are struggling to recruit: the lack of skills, basic literacy and simple maths are breath-taking [even among graduates! WITH Masters!]. HR are considering adverts in Germany...

  • rate this

    Comment number 102.

    Why do the right always seek to denigrate the views of people with differing views to their own as 'lefties', in a deliberately pejorative tone. So unemployment is down is it? It's still over 2.5 million isn't it, and yes, a great many of those 'jobs' are casual, low wage, part time, self-employed, or sub-contract. Time to rejoice then, the UK has transitioned to a low wage economy, whoopeedoo!

  • rate this

    Comment number 101.

    "Average earnings fall further behind inflation in October with average annual growth of 1.3% - less than half the inflation rate"

    Bad news, Stephanie, but only for the poor devils in the private sector. Your own blog (30/11/2012) tells us public sector pay continues to roar ahead - 9% rise in earnings per head over the last two years. Private sector austerity while the public sector prospers.

  • rate this

    Comment number 100.

    I wonder if the minimum wage is a drag on wage levels and productivity because employers can justify paying it as a default standard. My son found a job for 20 hours a week a few pence above minimum wage -I am proud that he is not on the unemployed register in these tough times but the reality is he cannot afford to live there without us his parents paying his rent- the living wage is needed

  • rate this

    Comment number 99.

    This is a good news story - unemployment is falling, private sector is creating jobs to make up for public sector spending restrictions.

    But once again Stephanie has to spin it to highlight any possible glimmer of bad news therein - please can we have a break from this - it is Xmas after all!

  • rate this

    Comment number 98.

    average weekly earnings in the uk are about £471 a week.

    no wonder starbucks can't make a profit.

  • rate this

    Comment number 97.

    CEO Chief Execs etc, getting rises of 20% plus sending there money "over seas", us plebs getting 1% if we are lucky, part time work in Supermarkets for those unfortunatly losing there technical jobs. And people are suprised the Tax take is down along with average earnings?

  • rate this

    Comment number 96.

    My wife works in the public sector and used (before all this triple dip recession took hold) to finish a contract and walk within weeks if not days into a new contract. Nowadays it is months if not years between contracts. She has 6 weeks remaining on her contract with nothing in the pipeline...Is she part of the figures full employment because if she is it is simply smoke and mirrors!!

  • rate this

    Comment number 95.

    The general trend is still encouraging putting misgivings about zero hours based contracts to one side because the trend is still good. Some Labour supporters now decrying figures because of Olympic effect (been and gone) and Xmas effect hello these are October figures. Stats people still confused that employment doesn't follow their calculation on GDP may be the latter needs more scrutiny

  • rate this

    Comment number 94.

    90. Pierre Lapin

    It is dire and there are still too many unemployed. Was it Government hype when unemployment was increasing?

    'For a start there are less Xmas jobs'

    How do you know that? Picking and choosing what to believe eh?

  • rate this

    Comment number 93.

    It's painful to earn less than we did in the past.- it requires us to make sometimes painful choices. But let's not forget the bigger picture - we are now paying ourselves a level of wages that our economy can realistically afford. Wages will return to growth once there is pressure on the supply of labour skills.

  • rate this

    Comment number 92.

    39 I do love how data is dismissed the moment it challenges prejudices. The lefties on here demanded growth, there was growth, the data was wrong.. They demanded youth unemployment fall, it falls, wrong type of jobs. Don't for get the BBC invented the term "under employed" so it didn't have to say anything nice about govt. Oddly quiet when Labour hid unemployed on non-degrees?

  • rate this

    Comment number 91.


    the number of people on government supported training and employment programmes classified as being in employment (excluding those classified as employees and self-employed) increased by 19,000 to reach 171,000.

    I'll grant you that I don't know the size of that excluding... caveat.


  • rate this

    Comment number 90.

    These figures... Oh dear. Don't believe any Govt hype, the situation is dire for the unemployed, and this year will be even worse.For a start there are less Xmas jobs, partly due to the ongoing recession but probably more to do with Workfare, the vile practice of forced employment for the unemployed.

  • Comment number 89.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 88.

    Can't help thinking if this had been Labour Stephanie would have been beside herself with joy! Still excellent news, and very pleased Labour has fallen for the BBC and Guardian spin and decided to oppose not handing over huge increases in unearned income in the mistaken belief the majority support that. People work hard, they are sick of the hand out culture!

  • rate this

    Comment number 87.

    I don't think those in 'workfare' are included in these figures see ONS:
    So who really knows what is going on?!


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