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Annie Hayes



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Jobless count soars


Unemployment has risen by 4.8%, a rise of 29,000 people over the quarter while the claimant count has also soared by 11,000 to a total of 828,700 over the same period.

Despite the gloomy news, however, official figures from the Office of National Statistics show a hike in the employment rate of 148,000 over the period.

The employment rate reached 75%, the highest levels since November 1975. Dr John Philpott of professional body, the Chartered Institute of Personnel and Development (CIPD) said the figures were a ‘landmark’.

Overall, the organisation admitted the outlook was good, describing the labour market as being in ‘robust health.’

Philpott commented: “Moreover, while the start of the annual bonus season has pushed up growth in average earnings to 4.7%, there has been a welcome easing in underlying wage pressure as measured by average earnings excluding bonuses (down 0.1 percentage point to 4.3%). This is particularly good news.”

“Together with the fall in the numbers of economically inactive people and a fall in unfilled vacancies this suggests an improved matching between labour supply and demand. It also greatly increases the prospects that interest rates will peak at 4.75% in the current economic cycle.”

Referring to the rise in unemployment as ‘disappointing’, Philpott said it could be explained by rising numbers of economically inactive people, particularly women, entering the jobs market to look for work.

“The rise in claimant unemployment is both more worrying and perplexing, suggesting some worsening of job prospects for unemployed claimants since the start of 2005, with more people joining the count and fewer leaving the count.

“However, given the overall strong growth in employment this is likely to reflect a shift in the relative situation of different groups of jobless people rather than a general easing in the demand for labour.”

Trades Union Congress chief, Brendan Barber welcomed the news of improved employment figures but warned:

“We should never be complacent about unemployment, however, and this rise underlines the importance of the New Deal, which has helped a million people into jobs.”

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Annie Hayes


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