High Figures Bring Bad News
 
Office for National Statistics figures show that unemployment rose to 2.261 million in the three months to April, the highest since November 1996.

The jobless rate also rose to 7.2%, the highest it has been since July 1997. While the number claiming unemployment benefit rose by 39,000 in May, which was much less than the original estimation of 60,000.

Young people are among the worst hit, with the unemployment rate of 18-24 year olds currently standing at 16.6%. And the claimant count rate rose to 4.8%, its highest since 1997.

Average earnings did however rise by 0.8% which was higher than expected, but this reflects the time of bonuses.

Young People Suffer Most

There were 271,000 people less in work over this three month period, the biggest quarterly drop since 1971 when the records began. And the number of job vacancies also fell by 35.6% compared from May last year to May 2009.

Young people are particularly suffering in the recession. In the first three months of the year 462,000 young people between 16-17 were employed, 16.5% less than in the same quarter of 2008.

Also in the same three months, 3.5 million aged 18-24 were employed, 4.8% less than the same time in 2008. Along with the unemployment range in the younger age group being 16.6%, the highest since 1993.

The General Secretary of the TUC, Brendan Barber said: “Youth unemployment is now at its highest for 15 years. And it will get worse when millions of fresh school leavers graduate and start looking for work in the coming weeks.”

Still Hope

The only age group that have increased in employment numbers are those of retirement age, with a rise of 2.6%. Analysts believe this means that the recession could be coming to an end but also say that it is too early to come to a firm conclusion.

The Chief Economist for the British Chambers of Commerce said: “These jobless figures are slightly better than feared, but the overall situation remains grim… It is much too early to talk about the end of recession and it is important not to withdraw the policy stimulus before there is firmer evidence that the economy has stabilised.”

On a less positive note, Alan Clark, an economist for BNP Paribas added: “The economy may actually start to expand, but it won’t be very fast… and until the economy is growing in line with its long-term average we will continue to lose jobs and we will continue to see downward pressure on wages.”

“It’s better than expected. It is probably still too soon to conclude that we have reached any turning point, but it is moderately encouraging,” added Ross Walker, UK economist at RBS Financial Markets.

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