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Unemployment fell by 45,000 to 2.63 million in the first three months of this year with many forced to work part time because they could not find a full-time job and self-employment rising significantly, according to figures from the Office for National Statistics.
The number of people in employment aged 16 and over increased by 105,000 betwen January and March, but fell by 7,000 on the year to reach 29.23 million. The number of part-time workers increased by 118,000 on the quarter to reach 7.99 million (the highest figure since comparable records began in 1992), but the number of full-time workers fell by 13,000 to reach 21.24 million. The number of people (excluding unpaid family workers and government supported trainees) who were working part-time because they could not find a full-time job increased by 73,000 on the quarter to reach 1.42 million, the highest figure since comparable records began in 1992. The number of self-employed people increased by 89,000 over the quarter to reach 4.16 million, the highest figure since comparable records began in 1992.
The unemployment rate for the three months to March 2012 was 8.2 per cent of the economically active population, down 0.2 on the quarter. However, the number of people unemployed for over one year increased by 27,000 to reach 887,000, the highest figure since the three months to September 1996.
The economic inactivity rate for women aged from 16 to 64 fell by 0.1 on the quarter to reach 29.0 per cent, the lowest figure since comparable records began in 1971. The female inactivity rate has generally been falling since comparable records for this series began in January-March 1971, when it was 44.5 per cent.
The figures also show that the number of people claiming Jobseeker’s Allowance (JSA) fell by 13,700 between March and April 2012, but increased by 106,600 on the year, to reach 1.59 million. This is the second consecutive monthly fall in this series and the largest fall since July 2010. The number of people claiming JSA for up to six months fell by 27,200 on the month and by 128,400 on the year to reach 858,800.
In terms of pay, the figures from January to March show total pay (including bonuses) rose by 0.6 per cent on a year earlier. The ONS says this is the lowest growth rate since March-May 2009 and it is down 0.5 on the three months to February 2012. Regular pay (excluding bonuses) rose by 1.6 per cent on a year earlier, unchanged on the three months to February 2012.
TUC General Secretary Brendan Barber said: “Today’s figures are mixed, with the welcome fall in unemployment driven entirely by part-time jobs. The number of under-employed people, who are taking part-time and temporary jobs for a lack of permanent full-time work, has hit two million for the first time ever. The falling number of full-time jobs and six per cent fall in real wages over the last two years means that people are having to make huge salary sacrifices and put their careers on hold just to stay in work.
“People’s incomes and job security today are barely any better than they were at the height of the financial crash. Unless governments act together and stop our austerity misery spiral, the UK’s economic depression will continue for far longer than feared.”
Dr John Philpott, Chief Economic Adviser at the Chartered Institute of Personnel and Development, said: “These are odd figures best explained by a surge in part-time odd jobbing. A sharp quarterly rise of over 100,000 in the number of people in work combined with another welcome fall in joblessness is remarkable for an economy that dipped back into recession at the start of the year.
Such an outcome would normally be a sign of economic recovery. However, while optimists might conclude that this casts doubt on the reliability of the most recent official GDP growth figures, a more sober assessment is that a very weak economy is managing to keep unemployment in check only by maintaining a severe squeeze on the size of pay packets and creating enough low productivity work to allow people to avoid the dole by doing the odd part-time job here and there, either as employees or on a casual self-employed basis.
“While a weak double dip labour market might be able to sustain enough odd jobbing to prevent unemployment hitting the 3 million mark, the combination of a growing army of underemployed odd jobbers, 2.63 million people unemployed and pay rises still lagging well behind price inflation suggests that the underlying employment situation is worse than at any point in at least the past two decades.”