Unemployment

Jamie Oliver, eh, what a card? Why can't Britain's revolting poor eat better food? If they can afford televisions they can afford mussels and rocket too, don't ya know? Something like that anyway. But instead they loaf in front of the goggle-box stuffing their fat faces with lardy ready-meals and fast food. What is to be done with them? And why can't they be more like the Spanish or the Italians? Never mind that Italian children are more likely to be obese than British children. Never mind, too, that kids in impoverished southern Italy are more likely to be overweight than children in the wealthier north. Instead just fantasise about a future in which poor British families will dine on fresh vegetables and the finest seafood.

Unemployment is down, there are fewer people claiming jobseeker's allowance, and more people are in work than ever before. So, the top line on today's employment figures: They're good news. The real picture is more nuanced. Unemployment is down by 4,000 on the previous quarter, a figure that is dwarfed by the margin of error. We might reasonably expect the real number of unemployed to be anywhere within 85,000 above or below the 2.51 million quoted. There have been nine straight months with fewer people claiming jobseeker's allowance, but the unemployment rate is still 7.8% - just where it was in August 2012, and a meagre 0.1 percentage points lower than the 7.9% it stood at when the coalition was formed. And 69,000 extra jobs (taking the total number of people in work to 29.

As ever there's good and bad news in today's jobs numbers. Unemployment fell by 57,000, but the number of people in employment only rose by 16,000. The figures also show that the greying of the British economy continues. In May there were 8,000 fewer 16-64 year olds in work, and 25,000 more 65-pluses in work. Since the peak of employment in 2008 there are more than 300,000 more pensioners working. There's one more thing that may turn out to be a big positive: Britons put in over 950 million hours in the last three months, that’s 0.4 per cent more than the previous quarter. According to the NIESR, GDP grew by 0.6% over the same period. That means that the productivity of labour - which has slumped during the recession - may be increasing again.

The number of people in work in December to February was 29.698 million — lower than last month's 29.732 million and representing a very slight 2,000 quarter-on-quarter fall — according to today's figures from the Office for National Statistics. Of course, 2,000 is just a 0.008 per cent drop, and since the margin of error for that change is ±139,000, the quarter could yet turn out to have been one of reasonable jobs growth. But in today's figures, the lack of employment growth, while the economically active population continued to expand, meant that the unemployment level rose by 70,000 — its biggest quarter-on-quarter rise since September to November 2011. The unemployment rate, which had fallen from 8.4 per cent in late-2011 to 7.

An unfamiliar noise floats over the town; an insistent, one-note metallic drone. Tracked to its source, it turns out to come from a sawmill in a hidden wooded valley a quarter of a mile from my house. Abandoned for the past year, the mill has suddenly come back to life. It is emitting great plumes of steam as well as a multi-decibel industrial racket. And men are working there — I can see only two or three, but still they constitute another little piece of the great employment puzzle. An uptick in demand for sawn timber matches reports of increased levels of activity in the construction and housebuilding sector.

Today's jobs figures are pretty unambiguously good news. The number of people in work rose by 154,000 in the last three months of 2012 to a new record high of 29.73 million — surpassing pre-recession peak by 158,000. And unlike other recent rounds of employment growth, this wasn't driven by a rise in part-time workers (their number actually fell by 43,000). But there are still a couple of reasons cause to greet this good news with caution. Rising employment at a time of economic stagnation has come at the expense of earnings. Adjusted for CPI inflation, average weekly earnings have fallen by 7 per cent in the last five years, back to 2004 levels. And the Office for Budget Responsibility doesn't expect them to start rising again until late-2014.

Depending on which paper you read this morning, the government's work experience scheme is either heading for the plug hole or going from strength to strength. The Guardian has an editorial praising Cait Reilly, the geology graduate who fought the workfare scheme she found herself on, The Telegraph says workfare can 'still do the job for Britain', and The Sun carries a bullish piece by Iain Duncan Smith on why the scheme is not 'slave labour'. The problem is that everyone has managed to interpret yesterday's Court of Appeal judgement as favouring their own view of the scheme. Reilly emerged yesterday with her lawyer to claim victory, but the Work and Pensions department seemed relatively unperturbed, too.

Dig out the bunting, fly the red flags in celebration, for finally we have a policy from the Labour party. Ed Miliband promised that 2013 would be the year he'd set out some 'concrete steps' on key policy areas, and to that end he's announced a jobs guarantee for the long-term unemployed. Coffee House readers will already be familiar with this scheme, as Shadow Work and Pensions Secretary Liam Byrne discussed it in his interview on this site in December.

Following my last post about the Dalkey Archive Press advert for unpaid interns I received an email from publisher John O'Brien. I think it sheds some interesting light on the issue so here it is in full: 'What started out as an announcement of two hires and then hoped-for interns who would become hires (putting aside my "characteristics" sections, if you can), all internships are on hold and will quite likely not resume. We are deluged with requests (paid or unpaid) for internships, and usually take on more than we can properly handle because people are rather desperate to get the experience, without which they cannot get the first door opened for them for a job.

It’s a bit early for predictions for 2013. But my feeling is that it could be the year of the unpaid intern, or rather, the year of the paid intern if the campaign to pay people a fair day’s pay for a fair day’s work continues to gather pace. Hazel Blears did well to secure cross-party support for a 10-minute-rule bill to outlaw the advertising of unpaid internships. It does seem odd that employers are obliged to pay the national minimum wage but can advertise that they are breaking the law. Campaigners Intern Aware has been pushing this particular cause for some time and should be congratulated for its work on the bill. The fact that HMRC is doing so little to enforce such breaches suggests it is perhaps not up to the job.

The number of people in work in the UK hit 29.6 million in August-October – the most ever — according to today's figures from the Office for National Statistics. So despite GDP still languishing 3 per cent below pre-recession levels, employment has fully recovered, with half a million jobs created in the last year: The rise in employment has been thanks to the private sector more than making up for the job cuts in the public sector.

1. Growth evaporating. The Office for Budget Responsibility once again downgraded its growth forecasts for 2012-13 and, for the first time, also did so for 2014-16. Despite that, the OBR is still slightly more optimistic than the average independent forecaster: 2. A seven year slump. On the OBR forecasts, it will now take until the end of 2014 to get back to where we were before the crash. In the 1930s, it took 'just' four years to recover: 3. Slower deficit reduction. The weaker economic outlook means the government will be borrowing more than expected. When George Osborne delivered his first Budget in 2010, the OBR predicted he'd get the deficit down to £20 billion in 2015-16. It now says it'll be £82 billion.

Today brings bad news that Tata Steel is to cut 900 jobs in the UK (at plants in South Wales, North Yorkshire, Teesside and the West Midlands). This is catastrophic news for a government that has announced its intention to rebalance the economy away from financial and professional services in the south-east (and therefore get an hearing electoral hearing in Britain’s former industrial heartlands); but that is only one aspect of the politics at play here. Tata's statement says: ‘Today's proposals are part of a strategy to transform ourselves into an all-weather steel producer, capable of succeeding in difficult economic conditions. These restructuring proposals will help make our business more successful and sustainable.

Today's employment figures don't contain much new to shout about. The number of people in work — although it rose by 100,000 on the previous quarter — is actually down very slightly from last month's record high (but still above the pre-recession peak, just). Unemployment fell by 49,000 from Q2 to Q3, although that's well within the Labour Force Survey's margin of error (so we can't be certain that it fell at all). The best news in today's figures — from the government's point of view — is probably that the headline unemployment rate is now 7.8 per cent, very slightly below the 7.9 per cent rate when the coalition took office (though again, it's worth remembering that the margin of error on that figure is +/– 0.3 percentage points).

Recently, we've been used to the economic figures being either bad news or mixed news. So today's employment stats come as a welcome surprise: it's almost all good news. They show that total employment rose by 212,000 from March-May to June-August, and now stands at 29.59 million — a record high, 18,000 above the pre-recession peak of April 2008. Since the election, a net of 616,000 jobs have been created. And unemployment is down too — by 50,000 on the previous three months, defying expectations. That means the unemployment rate has dropped to 7.9 per cent, the first time it's been below 8 per cent in over a year.