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Cooper: Unemployment falls for third consecutive month as Government pledges to invest in the jobs of the future

News Release issued by the COI News Distribution Service on 17 March 2010

DWP/048/10

Falling unemployment for the third consecutive month and news that the number of young people claiming unemployment benefit is down for the fourth month in a row were given cautious welcome by Work and Pensions Secretary Yvette Cooper today, however she warned that it was crucial to continue investing to support jobs in the recovery.

New figures published by ONS show the number of people claiming Jobseeker’s Allowance fell by 32,300 on the month and ILO unemployment fell 33,000 on the quarter to 2.45 million – the largest fall in unemployment for two and a half years.

The statistics show that the number of 18-24 year olds claiming Jobseeker’s Allowance has fallen for the fourth consecutive month, young people classed as unemployed on the ILO measure has also fallen for the third consecutive month.

The figures reflect the £5bn government investment to help the unemployed and the big increase in education and training places which mean there are over 235,000 more full time students compared to last year.

Yvette Cooper Secretary of State for Work and Pensions said:

“The fall in unemployment for the third month in a row is very welcome, but we should remain cautious. We're not out of the woods yet and we are still determined to do more to support jobs and help the unemployed this year.

“The figures show the investment in jobs, education and training places is making a real difference. Half a million fewer people are out of work than anticipated at the time of last year’s budget – saving over £10bn as a result.

“However, now is not the time to cut back on support for jobs. We know things will be difficult for some time, and unemployment in the eighties and nineties rose for years after the recessions finished. That is why we plan to increase help to get people back into jobs this year, not cut it back, so we can support the jobs of the future."

The government is still expecting some increases in unemployment before the summer before further falls in the second half of the year.

Today's provisional figures also show a drop of around 40,000 in the number of people on inactive benefits compared to four months ago. The Labour Force Survey also shows a rise of 149,000 in the number of people classed as inactive, although this includes a 98,000 rise in the number of students, and smaller increases in the number of parents staying home with children.

More strikingly, since the start of the recession there has actually been a fall of 75,000 people claiming inactive benefits (sickness benefits, including Incapacity Benefit and employment & support allowance; and income support). In the last recession the number claiming inactive benefits rose by 450,000 in two years as many who couldn't find work ended up long term sick and benefit dependent.

Today the Government has announced the funding for almost 7,000 Future Jobs Fund jobs bringing the total so far up to 117,000. The new positions include jobs as sports coaches, youth workers, solar panel installers, housing and classroom assistants.

Jim Knight Minister for Employment said:

“While it’s good news that the number of young people claiming unemployment benefit has fallen for the fourth month in a row, there is no let up in our investment to ensure every young jobseeker gets the chance to find work and make a future for themselves.

"I am delighted to announce a further 7,000 Future Jobs Fund jobs for young people as part of Government's unprecedented guarantee that 18-24 year olds who are unemployed for six months will get a job, a work placement or a training opportunity. We are determined to give them the chance to develop skills and get that all important foot on the career ladder.”

Ministers still expect increases in unemployment before the summer but are clear that as we enter the recovery the focus should be about making the economy ready for industrial and economic renewal in Britain and creating new jobs in growth sectors.

Notes to Editors

Background to labour market statistics: March 2010
This month’s Labour Force Survey covers November 2009 to January 2010. The claimant count and Jobcentre Plus vacancy count dates were 11th and 5th February respectively.

The number of people in work fell slightly this quarter:
- nearly 29 million people were in work in November to January.
- employment level in November-January was 54 thousand lower than the previous quarter, after rising by 38 thousand the previous quarter. Employment was 483 thousand lower than in the same quarter last year, but all bar 16 thousand of this came in the first half of the year.
- the employment rate is 72.2%, down 0.3 on the quarter and down 1.8 percentage points on the year.

The number of people on JSA drops this month but the number claiming other benefits is broadly flat::
- claimant unemployment was 1,585.1 thousand in February 2010, down 32.3 thousand on the level in January, and up 194.7 thousand on the year.
- the claimant unemployment rate, at 4.9 per cent, is down 0.1 percentage points on the month and up 0.6 percentage points on the year.
- inflows to JSA were 310.1 thousand in February, down 9.2 thousand on the month and down 51.6 thousand on the year. The number of people leaving JSA rose to 345.8 thousand, up 14.6 thousand on the month and up 91.4 thousand on the year.
- in the year to August 2009, the number of people claiming employment support allowance/incapacity benefits rose by 42,100 to 2.63 million. More recent provisional estimates suggest that there were 2.61 million claimants in January 2010, suggesting that the position has improved since August 2009.
- in the year to August 2009, the number receiving lone parent benefits fell 29,000 to 715,700. Provisional figures for January 2010 suggest the number of claimants has fallen further in recent months, to 695,000, driven by the recent conditionality reforms.

ILO unemployment has fallen this quarter:
- 2.45 million people were ILO unemployed in the November to January quarter, down by 33 thousand on the August to October period and up 383 thousand on the same quarter last year.
- the ILO unemployment rate is 7.8%, down 0.1 percentage points on the quarter and up 1.2 percentage points on the year.

The number of 18-24 year olds who are unemployed has fallen:
- 715 thousand 18-24 year olds were ILO unemployed in the November to January quarter, this is down by 34 thousand on the August to October period and up 87 thousand on the same quarter last year.
- of the 915 thousand ILO unemployed under 25 year olds, 262 thousand are in full time education.
- there were 470.4 thousand 18-24 year olds claiming JSA in February down by 13.2 thousand on the level in January and up by 50.3 thousand on the year.

The level of economic inactivity is up on the quarter and up on the year:
- the economic inactivity level is 8.2 million, up 149 thousand on the quarter and up 371 thousand on the year.
- the economic inactivity rate is 21.5 per cent, up 0.4 percentage on the quarter and up 0.9 percentage points on the year.
- The rise in inactivity over the last year is mainly the result of more inactive students. Excluding students, inactivity as a proportion of the working age population is at 15.4 per cent, up 0.1 points on the quarter and up 0.2 points over the last year.

There are still many vacancies available, and the number of redundancies has fallen back this quarter:
- There were 168 thousand redundancies in November to January, down 22 thousand on the previous quarter and down 108 thousand on the previous year.
- ONS’s vacancy survey estimates an average of 480 thousand unfilled vacancies in the three months to February 2010, up 39 thousand on the quarter and down 2 thousand on the year.
- In the last month Jobcentre Plus has taken on average over 10,000 new vacancies every working day and many more come up through other recruitment channels.

Total weekly pay in October-December was up by 0.8 per cent over the year:
Total weekly pay in November-January was up by 0.9 per cent over the year:
- growth in regular weekly pay, excluding bonuses, was up 1.4 per cent on the year

Contacts:

Department Work and Pensions
Phone: 020 3267 5144
NDS.DWP@coi.gsi.gov.uk