Press release

Grayling: unemployment rises as Government announces more support for young people

This news article was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

The Government must continue with measures to reduce the deficit, stimulate the economy and support people who lose their jobs back to work.

The Government must continue with measures to reduce the deficit, stimulate the economy and support people who lose their jobs back into work, Employment Minister Chris Grayling said today.

New figures published by the Office for National Statistics today show a rise in unemployment of 114,000 to 2.56 million (ILO measure)  indicating that the slowdown in the world economy and fragile financial markets in both Europe and North America are continuing to have an impact on the UK economy.

The Government has already taken decisive action to reduce the deficit and restore economic stability.  As well as committing to cut business taxes to one of the lowest rates in the G7, Ministers are announcing a £173 million boost to drive manufacturing growth.

Today’s figures show a rise in the number of unemployed 16-24-year-olds to 991,000, although that figure includes 270,000 students looking for a job, leaving the real number of youth unemployed at 721,000.  The Government is determined to tackle youth unemployment and this is why Ministers have today announced the next part of their strategy, with the formal launch of sector-based work academies across the UK. The new academies will offer a combination of training, work experience and a guaranteed job interview to up to 50,000 people over the next two years, with many going to young people.

Together with the Work Programme and the Government’s Work Experience scheme it will mean support for up to 150,000 young people over the next few months and 250,000 people over the next two years.

Employment Minister Chris Grayling said:

It is clear that we are seeing the effect of the international economic crisis on the UK labour market. That’s why last week we announced the right to buy housing scheme to support growth and today we are offering more support for jobseekers as sector-based work academies come on stream, combining real training, work experience and a guaranteed interview.

Our new Work Programme is now up and running and offers people who have lost their jobs flexible, tailored support to get back into jobs and stay there.

This week the Government announced the go-ahead of 79 free schools and university technical colleges to ensure that young people have the skills that employers demand which is crucial to economic growth.

The Government is taking the steps needed to support growth and rebalance the economy, including:

  • the creation of eleven new Enterprise Zones, designed to boost local growth and create over 30,000 new jobs by 2015;
  • providing real incentives for businesses to grow and create job opportunities;
  • announcing four annual reductions in corporation tax;
  • cutting the small companies rate;
  • expanding loan guarantees;
  • simplifying health and safety laws;
  • investing in science and apprenticeships;
  • promoting exports through major trade missions;
  • launching the New Enterprise Allowance (NEA) which will help up to 40,000 businesses get up and running;
  • supporting work clubs and enterprise clubs across the country;
  • reforming the Welfare State to make work pay.

We will ensure that people who lose their jobs get the best possible support available.  Our new Work Programme is now up and running across the country and will offer flexible support tailored to people’s needs to help them get into employment.

Notes to Editors:

Background to labour market statistics: October 2011

This month’s Labour Force Survey covers June to August 2011. The claimant count and Jobcentre Plus vacancy count dates were 8 and 2 September 2011 respectively.

The number of people in work fell this quarter

  • 29.10 million people were in work in June to August 2011.
  • the employment level fell 178 thousand on the previous quarter and 47 thousand on the year.
  • the employment rate is 70.4%, down 0.3 points on the quarter and on the year.

ILO unemployment rose this quarter

  • 2.57 million people were ILO unemployed in the June to August quarter, up by 114 thousand on the March to May period and up 113 thousand on the same quarter last year.
  • the ILO unemployment rate is 8.1%, up 0.4 percentage points on the quarter and 0.3 percentage points on the year.

The number of people on JSA rose again this month, but the number claiming one of the other main out-of-work benefits is improving:

  • claimant unemployment was 1,597.2 thousand in September 2011, up 17.5 thousand on the level in August 2011, and up 129.2 thousand on the year.
  • the claimant unemployment rate, at 5.0%, is up 0.1 percentage points on the month and 0.4 percentage points on the year.
  • the figures continue to be affected by welfare reform, including the ongoing process to re-assess existing claims for incapacity benefits, and this is likely to have made some contribution to the rise in the JSA caseload.
  • in the year to February 2011, the number claiming incapacity benefits fell 36,000 to 2.58 million. The most recent provisional figure for August 2011 suggests the caseload has since fallen further to 2.55 million.
  • in the year to February 2011, the number of lone parents on income support fell 78,200 to 613,800. Provisional figures for August 2011 suggest the number has fallen further in recent months, to 590,000, driven by welfare reform.

The level of economic inactivity is up on the quarter and on the year

  • the economic inactivity level is 9.4 million, up 26 thousand on the quarter and 75 thousand on the year.
  • the economic inactivity rate is 23.3%, unchanged on the quarter but up 0.1 points on the year.
  • excluding students, inactivity as a share of the 16-64 population is 17.6%, unchanged on the quarter and on the year.

The number of redundancies and unfilled vacancies rose

  • There were 150 thousand redundancies in June to August 2011, up 6 thousand on the previous quarter and year.
  • ONS’s vacancy survey estimates an average of 462 thousand unfilled vacancies in the three months to September 2011, up 1 thousand on the quarter and 5 thousand on the year.

Total weekly pay in June to August was up by 2.8% over the year

  • growth in regular weekly pay, excluding bonuses, was up 1.8% on the year.