UK unemployment: Jobs up, pay down
- 12 December 2012
- From the section Business
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.