Unemployment jumps 220,000 to 2.4m
Jobless rate climbs to 7.8% of the workforce
- guardian.co.uk, Wednesday 12 August 2009 13.57 BST
- Article history
Unemployment in Britain jumped by 220,000 in the three months to June to 2.435 million, official data showed today, the highest level since 1995.
The Office for National Statistics said that the jobless rate was now 7.8% of the workforce.
The figures also showed a huge 271,000 drop in the number of people in work – the biggest fall since records began in 1971 – although there was a similar fall in the February to April period this year.
There was a rise of more than 50,000 in the number of the under-25s without work to a total of 928,000, fuelling fears of a "lost generation" of jobless. The Prince's Trust said that around half of these were able to claim unemployment benefit, which was now costing the government £3.4m a day.
"But this is just the start of a long and downward spiral, which all too often leads to crime, homelessness or worse. Only by stopping young people falling out of the system can we rescue this lost potential and save the economy billions each year," said Martina Milburn, the charity's chief executive.
The Liberal Democrat work and pensions spokesman, Steve Webb, added: "Young people should be getting intensive support as soon as they sign on instead of having to wait a year for a guarantee of a job or training place. With vacancies at a record low, it is vital that we prevent today's school and university leavers from becoming a lost generation of long-term unemployed."
The ONS also reported a relatively small rise of 25,000 in the number of people claiming jobseeker's allowance. Under that measure there are now 1.58 million people claiming benefit, equivalent to 4.9% of the workforce, which is the highest rate since October 1997.
There is now widespread suspicion among experts that the claimant count figures are not representing the true state of joblessness since many unemployed people are unable to claim benefit. Yesterday the Department for Work and Pensions announced an inquiry into the recent divergence between the two measures of unemployment.
'Unacceptable' and 'ghastly'
Ahead of the figures, the business secretary, Lord Mandelson, admitted this morning that unemployment levels were "unacceptable", although he insisted that even more people would be out of work if the Tories had been in power during the recession.
Speaking on BBC Radio 4's Today programme, Mandelson said: "One thing I and the government know is that any such level of unemployment is unacceptable.
"The question is, what is the government doing about it, and what would be the level of unemployment if the government had not intervened in the economy in the way in which we have?"
He said the government was spending £5bn on getting people back to work while the Conservatives wanted to cut state investment in the economy by a similar amount.
TUC general secretary Brendan Barber said: "Today's figures show we are still some way off recovery. With over one in six young people out of work, unemployment is already at crisis level. The government must do more to get people back into work, otherwise we risk losing another generation of young people to mass unemployment."
Describing the figures as "ghastly," Howard Archer, chief UK and European economist at IHS Global Insight said he suspected the International Labour Organisation (ILO) measure of unemployment "is painting a truer picture of the current state of the labour market" than the much narrower claimant count measure.
"In particular, over the summer months, there are likely to be a lot of students who have just left college or school and cannot get a job, thereby going straight into unemployment," Archer said. "These do not show up on the claimant count data as they are not eligible for benefits. Indeed, youth unemployment is already a major source of concern."
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