Employment still lagging badly

Last week's announcement that unemployment in the region and nationally has fallen was clearly welcome news and not surprisingly seized on by those seeking to demonstrate that the current economically austere programme is the right course. A regional unemployment rate of 11.2 per cent, however, remains economically and socially unacceptable in a mature, developed and relatively prosperous state like the UK. This scale of unemployment remains the highest in the UK, nearly three percentage points above the national average, with one in four workers currently economically inactive also there should be some considerable caution over any false dawns.

All sensible analysis would show that growth and shared prosperity is still a long way away. Deeper scrutiny of the latest labour market statistics shows some particularly worrying trends and present a situation that the apparent 'good news' regarding employment growth is actually masking a worsening, not improving economic outlook.

The JSA claimant count, for example, while down over the quarter was, in fact, up in March. Long-term unemployment, a really challenging situation for those experiencing it and a scenario which makes returning to employment more difficult the longer people experience it, was up also.

What growth in employment there has been is also bedevilled by a part-time and precarious nature. The latest statistics show that the number of people in full-time work was actually down on both the last quarter and over the last year. Employment growth has been fuelled by part-time and vulnerable work; part-time employment now stands at a record high with an additional 89,000 people working part-time who wish to work full-time employment, with the largest percentage of new jobs on short-term, temporary contracts and agency work. Of course, part-time work for many is better than no job at all, but it is not so much a growth in employment, but a growth in under-employment.

The reality is that key sectors, especially those that have traditionally offered employment opportunities to young people, have actually seen the number of jobs in those sectors fall by over a million since 2007, manufacturing, construction, retail and hospitality all employing less now than they did four or five years ago contributing to the situation that in some parts of the region there are over 20 JSA claimants for every current vacancy.

The real experiences of workers and their families are of continued squeeze and ongoing economic downturn. There is little activity in consumption, little confidence and no indication whatsoever of a wages-led recovery. The latest rise in inflation has only emphasised the ongoing pressure on families. While goods are rising at an average of 3.5 per cent (with some goods obviously rising higher than that) real incomes continue to fall.

Average wage rises on current settlements stands at just 1.1 per cent, an effective 2.4 per cent pay cut - with public sector wage freezes meaning public sector workers are enduring an even bigger pay cut than that. It's clearly a little early to celebrate the dawn of the upturn.

Kevin Rowan

Regional Secretary

Northern TUC