Unemployment

So, new jobs figures out today. Which do you want first: the bad news, or the kind-of-alright news? The bad news is that employment’s showing no signs of growth: the total number in work has been stuck at 29.1 million since it fell there in the summer. It’s a touch better than the trough of 28.8 million we hit at the end of 2009, but still half a million below where we were when the recession hit. And we’re showing no signs of getting there any time soon: And the not-so-bad news? Unemployment’s slightly down on last month, which was slightly down on the month before. It’s not a big drop — well within the margin of error — and the number of unemployed still stands at 2.7 million, so this doesn’t exactly count as good news.

Today’s ONS release will make pretty grim reading for students and recent graduates. It shows that the unemployment rate among recent graduates — those who graduated in the last six years — stands at 9.1 per cent, higher than the overall unemployment rate of 8.4 per cent. It’s even worse for those who graduated in the last two years — the unemployment rate among them is 18.9 per cent, up from 10 per cent before the recession. But there’s an even more worrying trend among those recent graduates who do find employment. In 2001, three-quarters of them were in ‘higher skill’ jobs — those requiring more than GCSEs. Now, less than two-thirds of them are: So what does this mean?

Youth unemployment is approaching crisis levels in Britain. For almost two decades, Britain’s more flexible labour market had favourable effects on youth employment. But the re-regulation of the British economy has narrowed the difference between our jobs market, and that of the continent. Meanwhile the British poverty trap has been strengthened by a dysfunctional welfare state: British workers can in some circumstances keep as little as 5p in every extra pound they earn if they find work. Who would break their back for less than 50p an hour? We’re paying people not to bother, so little wonder that most of the employment rise — in the last government, and under this one — is accounted for by a rise in foreign-born workers.

On the Today Programme this morning, Employment Minister Chris Grayling defended the government's Work Experience programme in light of the recent controversies around it. Here's a full transcript of the interview: Evan Davis: Well how can work experience get such a bad name? A string of high profile companies have pulled out of one government scheme providing work experience for young people. The latest, retailer Poundland, has announced it is suspending its participation in the scheme although it’s not quite clear which scheme it is, because there are several government schemes for getting people, long-term unemployed or young, into work. Let’s see if we can clarify what is going on with the Employment Minister, Chris Grayling. Good morning to you.

The employment level has risen since the election, according to today’s figures — albeit only slightly, from 29.0m to 29.1m. But unemployment’s up too: from 2.46m to 2.67m. So how come we’ve seen both more jobs and lengthening dole queues? Well, that’s because the ‘economically active’ population (people who are in work or ‘have been actively seeking work and are available to start work if a job is offered’) has grown faster than employment has. There are now 31.8m people in the UK who fit that description, an increase of 320,000 since the coalition came to power. But with only a 110,000 rise in employment, that means the number of folk unemployed has risen by 210,000.

No two ways about it: today’s employment figures are difficult for the coalition. The unemployment figure’s up for the seventh month in a row, and now stands at 2.68 million — the highest since 1994. And the unemployment rate — up to 8.4 per cent — is at its highest since 1995. It doesn't look like getting better anytime soon, either: unemployment's predicted to carry on rising at least until the end of the year, possibly matching the three million peak of the early ‘90s. In its defence, the government claims that employment is rising too. Today's figure of 29.1 million in employment is about 150,000 higher than it was at the general election. That may seem odd — how come unemployment's up when more people are employed?

Reading the papers today, you could be forgiven for thinking that MigrationWatch’s new report was a smoking gun against immigration. Here we have a study that links immigration to unemployment, in the face of nearly all previous research that has found no such link. However, looking at the MigrationWatch piece itself, it quickly becomes clear how implausible these claims are. The MigrationWatch report centres on a comparison of rising youth unemployment and rising immigration from the ‘A8’ countries – the Eastern European states that joined the EU in 2004. The correlation between the two is remarkably weak. During the initial rise in immigration between 2004 and the end of 2008, there is no significant rise in unemployment at all.

There was a time when Nick Clegg was the most agile and persistent defender of the coalition's deficit reduction programme. But now — although he's still got it in him — he is more often wheeled out to announce some spending wheeze or other. A couple of weeks ago, it was the next instalment of the government's regional growth fund. Today, it's a £1 billion scheme, spread out over three years, to encourage companies to take on young people. This latest scheme is one of those that looks very neat on paper. Put aside questions about how it will be funded, and what we have is a plan whereby £2,275 will be paid to companies for each young recruit they bring on. It means that, in effect, the state will cover half of the youth minimum wage for a six-month period.

Despite – or perhaps because of – the recession, pensioner employment has increased dramtically over the past few years. In his Telegraph column today, Fraser remarks on this important but largely ignored trend in Britain's workforce. 'A million jobs have been lost since the Great Recession began', he says, 'but the number of pension-aged people in work has increased by 200,000.' Here's that phenomenom in graph form: Why has this happened? Fraser puts his finger on one important factor: 'Crucially, they pay less tax. A pensioner manning the tills in Tesco will take home 12 per cent more than a working-age colleague on the same salary.

Today's unemployment figures do not make for cheery reading. Youth unemployment is up to over a million and unemployment overall has reached 2.62 million, meaning that the unemployment rate is the highest it has been for 15 years. Laura Kuenssberg tweets one particularly striking statistic: 'Number of UK Nationals in work fell 280k compared to this time last year, number of non-UK Nationals in work increased 147k over same time' This suggests that it's a touch too simple just to say that there are no jobs out there. It also means that we really should think about why non-UK nationals are proving so much more adept at finding work than their British counterparts.