Labour Market Report #6: Signs of future labour market weakness
The TUC’s 6th Labour Market Report provides an overview of the most recent labour market data. While falling unemployment and rising employment levels are good news, there are also a number of concerning signs about the future direction of the labour market recovery, with the rate at which unemployment is falling starting to slow, and under-employment remaining high.
Between April and June ILO unemployment was 2,457,000. While this was a fall of 49,000 on the quarter, the level only fell 12,000 on the previous month’s release (March – May) and unemployment by the ILO measure remains 841,000 higher than January 2008.
The claimant measure of unemployment has also continued to fall, with 1,461,200 people currently in receipt of JSA. Again the rate at which the level is falling has slowed: between Jan and Feb claimant levels fell by just over 40,000, while the monthly change between June and July was only 3,800.
Vacancies increased slightly on the quarter (9,000), but fell on the month (also by 9,000) – despite the new Government’s continual assurances that there are plenty of jobs available the ratio between vacancies and unemployed people is 1:5 – double the ratio of January 2008.
The prospects for a labour market recovery remain shaky. With job cuts already starting to bite across the public sector, and many private sector companies being hit by public spending reductions, the risk is that rising job losses and poor employment growth will lead to even higher levels of unemployment.