Press release

Grayling: welcome rise in private sector employment but five million still relying on benefits

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

The biggest quarterly rise in employment on record, driven by the private sector, is welcomed.

The biggest quarterly rise in employment on record, driven by the private sector, is welcome news but the fact that these jobs are not being filled by people on benefits underlines the need for urgent reform, Employment Minister Chris Grayling said today.

The figures published by the Office for National Statistics show that while the number of people in employment rose by 286,000 on the quarter, the nearly five million people claiming the three main out of work benefits has not improved significantly, with a slight increase this month in the numbers claiming Jobseeker’s Allowance.

Chris Grayling said:

Today’s jump in employment, driven by the private sector, is good news but it doesn’t disguise the fact that the system the Government inherited is failing to get people on welfare into these jobs. It is neither fair for the nearly five million people on benefits, nor the taxpayer who supports them.

That’s why we are pressing ahead with retesting everyone claiming incapacity benefits and introducing our new Work Programme, which will give people the tailored support they need to move them into sustained work.

Latest DWP figures show that the number of people claiming incapacity benefits (ESA/IB) is estimated to be 2.605 million in July, with lone parents claiming income support at 675,000.

From next year jobseekers will benefit from the new Work Programme and will be designed to give people the right help when they need it, treating them as individuals rather than on what benefit they happen to be on.

Notes to Editors:  Background to labour market statistics: September 2010

This month’s Labour Force Survey covers May to July 2010. The claimant count and Jobcentre Plus vacancy count dates were 12th and 6nd August respectively.

The number of people in work rose this quarter

  • 29.16 million people were in work in May to July.
  • the employment level in May-July was 286 thousand higher than in the previous three months, and up 301 thousand on the year.
  • the employment rate is 70.7%, up 0.4 percentage points on the quarter and 0.1 percentage points on the year.

The number of people on JSA rose slightly this month and there are nearly 5 million people in total claiming one of the main out-of-work benefits:

  • claimant unemployment was 1,466.3 thousand in August 2010, up 2.3 thousand on the level in July, and down 135.5 thousand on the year. 
  • the claimant unemployment rate, at 4.5%, is unchanged on the month and down 0.4 percentage points on the year.
  • in the year to February 2010, the number of people claiming employment support allowance/incapacity benefits rose by 11,220 to 2.61 million. More recent provisional estimates for July 2010 suggest the position has since remained broadly stable.
  • in the year to February 2010, the number receiving lone parent benefits fell 44,020 to 692.0 thousand. Provisional figures for July 2010 suggest the number of claimants has fallen further in recent months, to 675,000.

ILO unemployment has fallen this quarter

  • 2.47 million people were ILO unemployed in the May to July quarter, down by 8 thousand on the February to April period and down 5 thousand on the same quarter last year.
  • the ILO unemployment rate is 7.8%, down 0.1 percentage points on the quarter and 0.1 on the year.

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

  • the economic inactivity level is 9.26 million, down 158 thousand on the quarter and up 31 thousand on the year.
  • the economic inactivity rate is 23.2%, down 0.4 percentage points on the quarter and unchanged on the year.
  • Excluding students, the inactivity rate is 17.7%, down 0.1 points on the quarter and the year.

The number of vacancies and the number of redundancies both fell this quarter

  • There were 142 thousand redundancies in May to July, down 31 thousand on the previous quarter and 90 thousand on the previous year.
  • ONS’s vacancy survey estimates an average of 467 thousand unfilled vacancies in the three months to August 2010, down 14 thousand on the quarter and up 31 thousand on the year.

Total weekly pay in April-June was up by 1.5% over the year

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