19 June 2015
According to the Office for National Statistics, unemployment has fallen by 43,000 to 1.81 million, and wage growth at 2.7% both including and excluding bonuses, a four year high. It goes without saying that recent improvements do not make up for years of stagnation.
ONS records the present employment rate as 73.4%, and the unemployment rate as 5.5%.
Anthony Reuben, head of statistics at the BBC questioned the accuracy of the figures, saying; “The headline unemployment number comes from the Labour Force Survey, in which the ONS interviews about 40,000 people every quarter. That’s a very big survey, but as with all surveys it means there is a margin of error.”
“In the case of the number of people unemployed, it means they are 95% sure that the estimate they have produced is no more than 78,000 out either way. So when they say their best estimate is of a 43,000 fall in unemployment, they mean that they are 95% sure that the actual figure is between a fall of 121,000 and a rise of 35,000. As we can’t be 95% confident that unemployment has fallen at all, it means that today’s reported drop in unemployment is not statistically significant.”
Equally with inflation running at only 0.1%, strong wage growth looks unlikely.
TUC research has found that underemployment is nearly a million higher than before the financial crisis. Underemployment is defined people who have fewer hours than they desire and people who work part-time but want to work full-time.
There were 2.3 million people underemployed in early 2008, compared to 3.4 million in early 2014. It has fallen slowly in the last year to reach just under 3.3 million in early 2015 – but this is still over 900,000 higher than it was before the recession.
TUC General Secretary Frances O’Grady said: “The headline employment rate may have returned to its pre-recession level, but underemployment has barely recovered, so we are still a long way from a full jobs recovery.
“The government must address labour market failures that have left us with too many poor quality jobs, and not enough decent jobs with full-time hours. Full employment means not only making sure everyone can get a job, it also means making sure they have a full week’s work if they need it.
“The current economic plan is not delivering enough high quality full-time jobs for everyone who wants one. The Chancellor’s plans for extreme cuts in the Budget next month will not deliver the productivity gains we need for better jobs with more hours. A much better economic plan would set out a clear pathway to close the UK’s investment gap, so that we stop trailing other countries on the innovation needed to create more high quality full-time work.”