Unemployed people’s chances of getting work
Figures published today show that the image of unemployed people “languishing on the dole” is wrong. Mainly, the benefits and services provided by Jobcentre Plus do their job: most people who become unemployed get another job reasonably quickly. But the new figures also show that the labour market has become substantially riskier for workers.
Today’s statistics on Moving between Unemployment and Employment are revealing. The first thing you discover is the huge amount of ‘churn’ in the labour market. For instance, in the second quarter of this year, 978,000 working age people moved into employment and 870,000 moved out – both of these figures are massive compared to the net figure of 108,000 moving into jobs. Every year, more than seven million people move one way or the other.
In particular, I want to highlight the fact that, each quarter, more than half a million unemployed people get jobs. One of the arguments for benefit cuts is that we have a broken system that encourages benefit dependency, where unemployed people are allowed to spend long periods on more than adequate benefits. But today’s statistics show that, for most people, the system works and they move back to work quickly.
This confirms an under-reported message from last month’s DWP Transparency Data, which is that the large majority of unemployed people get back to work in less than 52 weeks. The most recent figures we have are for April of this year, and of people who started to receive JSA in May 2012, 89.5 per cent had got jobs within 52 weeks. This isn’t a one-off either; this figure has been remarkably consistent over time:
Well, that’s the good news. But there’s a more worrying side to today’s figures, and that’s the employment and unemployment “hazard” figures. For employed people this is the risk of unemployment and it’s worked out by taking the number moving from employment to unemployment in one quarter and calculating it as a percentage of the total number of employed people in the previous quarter. Unsurprisingly, that figure shot up during the recession and came down quickly afterwards, but it’s worrying that it seems to have settled at a higher level:
You can also calculate the “hazard” of employment for unemployed people and if we look at what has happened to this figure over the past ten years or so, the picture is even more worrying:
It looks as though we’ve settled down to a post-recession world in which the risk of unemployment has gone up if you’re in work. And your chances of getting a job if you’re unemployed have shrunk significantly. It’s true that the employment figures have been pretty good for the past couple of years and there’s some sign that the unemployment numbers are starting to move in the right direction.
But this certainly hasn’t translated into more job security for workers or job opportunities for unemployed people.
And blaming unemployed people for their unemployment is particularly inappropriate at a time when their chances of getting jobs have been cut by seven or eight percentage points.