UK Unemployment: July 2012

Saturday, July 21st, 2012 - UK Unemployment Statistics

UK Unemployment: July 2012

Usually, I would do the review of UK Unemployment figures the day after they came out from the Office of National Statistics, but this time I decided to wait three days. Apart from being busy, why?

Read behind the headline figure of a fall in UK unemployment fell by 65,000 to 2.58 million in the three months to May, and the news is not so good:

  • The number of people claiming Jobseeker’s Allowance rose by 6,100 to 1.6 million in June
  • The number of people out of work for more than two years rose by 18,000 to 441,000, the highest since 1997
  • Unemployment here in Wales its up by 2,000
  • The number of vacancies is at a low within the last three years

Further, of that fall of 65,000, 50,000 of those jobs were created in central London. Now, what’s going on in London over the next month that would require an additional 50,000 people?

Plus we have to add that this years crop pf graduates from schools, colleges and universities still have to reach the statisticians measurement system, yet.

We also need to add in that all of the economic professionals are getting nervous. The Bank of England announced Quantative Easing Phase3 last week, while the IMF after reigning back its forecast for 2012-2014 for UK economic growth by between 0.5% and 1.0% – effectively halving it – urged the Chancellor to do more to avoid an elongated double-dip recession and lost decade.

In summary, looking back over the years, July is always a good month for employment statistics. The summer creates more employment through employees taking holidays and resultant temporary vacancies, while the holidays that they take create seasonal vacancies. Plus, the new graduates have not got into the system, so are not counted. Summary: vacancy high, job seekers low = employment rising.

The key months for me for measuring unemployment and job creation in the UK economy are always September and October, and February through May. These periods avoid seasonal issues, and further are fully-measured periods of who’s out there seeking work, and who’s creating it.

But this year, the July underlying economic story is not good. In fact it looks more like post-2008 recesion, as opposed to a proposed recovery “next year”. With the Euro crisis still ongoing, and companies storing cash and reducing employment, I await the end of summer to see if we get a better forecast.

Good Luck!


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