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Unemployment at highest rate for six years

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New government figures show that unemployment in May had risen to 5.4 per cent, its highest rate for six years.

The Office of National Statistics (ONS) said unemployment rose by 90,000 during the three months to May to stand at 1.65 million. The claimant count – the number of people claiming unemployment benefit – rose by 5,900 in June to 956,600. It has risen for 15 of the past 16 months.

In addition, the number of jobs in the manufacturing sector is at its lowest since comparable records began in 1978.

But the number of people classed as economically inactive – students, those looking after family and home and the long-term sick fell by 79,000 during the quarter. And over the past year, the number of people in employment has risen by 223,000.

Government ministers have linked the fall in the number of people claiming incapacity benefit to the rise in the number of jobless.

Jim Murphy, Minister of State for Employment and Welfare Reform, said: “I’m encouraged by the fact that more people who previously weren’t looking for work are now doing so.

“What is more, the biggest improvement has been amongst those who regard themselves as long-term sick. We must do more to help match these people who are now looking for work with the 600 thousand vacancies reported in June.

“That is why our Welfare Reform Bill, and the roll-out of Pathways to Work for people on incapacity benefits, is so important. They will enable us to give many more people the individual help they need – firstly to look for work, and then to get over the barriers that stop them from taking it up.”

Although the TUC welcomed the news that the number of people in employment has risen, it was not so optimistic about increasing unemployment.

General secretary Brendan Barber said: “The continuing rise in unemployment is a concern. The Government should take swift steps to tackle the upward creep of unemployment by increasing funding for back to work support for unemployed people and investment in skills and training, as well as taking measures to protect jobs in the manufacturing sector.”

ONS figures also show that the number of redundancies has remained broadly the same over the quarter, rising from 141,000 to 147,000. The number of job vacancies was around 598,100 in June, compared to 596,200 three months earlier.

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