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date: 18 January 2010

embargo: For immediate release

Universal Job Guarantee would stop years of long-term unemployment

A coalition of labour market experts are today (Monday) calling on the Government to introduce a Universal Job Guarantee for anyone out of work for more than 12 months to prevent long-term unemployment rising for years after the recession ends.

The coalition, which includes the TUC, Demos Open Left Project, Professor Paul Gregg, Professor Richard Layard, the Resolution Foundation, The Work Foundation and James Purnell MP, has written to Secretary of State for Work and Pensions Yvette Cooper MP warning against a repeat of mistakes of the last two recessions, when unemployment was allowed to spiral out of control.

With economic indicators suggesting that the UK is likely to have moved out of recession in the fourth quarter of 2009, the coalition is warning that the number of people out of work for at least 12 months continued to rise for 18 months after the 1990s recession ended. It also took six years from the end of that recession for levels of long-term unemployment to return to pre-recession levels.

Official figures show that long-term unemployment peaked in Spring 1993, when 1,243,000 people had been out of work for at least 12 months. In the Spring of 1990 (before the recession started), 646,000 people had been out of work for this long, and it took until Autumn 1997 for long-term unemployment to return to a similar level (633,000).

The letter warns that periods of long-term unemployment increase the likelihood of mental health problems, relationship breakdown, and issues relating to alcohol, debt and homelessness. Mass unemployment can also devastate entire communities and damage prospects for future job creation as local demand is reduced, says the coalition.

To counter rising long-term unemployment, the coalition is calling for the Government to introduce a Universal Job Guarantee for anyone who has been on Jobseekers' Allowance for more than 12 months.

Employment delivered through a Job Guarantee, which would pay the minimum wage and last for at least six months, is the best way to give people the kind of genuine work experience that employers want, the letter says. A Universal Job Guarantee could be delivered in a similar way to the jobs currently being offered by the Government through the Future Jobs Fund.

TUC General Secretary Brendan Barber said: 'While recent economic indicators offer reasons for cautious cheer, unemployment remains a huge concern. There must not be a repeat of the last two recessions, when millions of people were stuck in semi-permanent unemployment long after the economy had recovered.

'Long periods out of work can have a devastating impact on people's health and mass unemployment can crush communities. A Universal Job Guarantee would help prevent this.

'A job paying decent wages for at least six months provides the kind of experience employers want and gives an unemployed person the best possible chance of getting back to work.'

NOTES TO EDITORS:

- Long-term unemployment levels in the 1990s

Source: ONS historical data, not seasonally adjusted (seasonally adjusted figures are only available from Spring 1992)

- The 1990s recession lasted from the Autumn quarter of 1990 to the Autumn quarter of 1991(inclusive).

- The full text of the letter is available from the TUC press office.

- All TUC press releases can be found at www.tuc.org.uk

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Contacts:

Media enquiries:
Liz Chinchen T: 020 7467 1248 M: 07778 158175 E: media@tuc.org.uk
Rob Holdsworth T: 020 7467 1372 M: 07717 531150 E: rholdsworth@tuc.org.uk
Elly Brenchley T: 020 7467 1337 M: 07900 910624 E: ebrenchley@tuc.org.uk

Press release (700 words) issued 18 Jan 2010