Friday, 19 April 2013

Change is required

Wednesday's labour market figures, for many, will have felt like another blast from the past. Though the claimant count fell slightly, employment is down - and the wider measure of joblessness rose 70,000 in the three months to February. Most striking were the earnings figures. On average, weekly earnings [excluding bonuses] have risen by 1% in the past year, a cash increase of just £3 a week. That's the lowest percentage rise since comparable records began, in 2001.

By this measure, at least, the squeeze isn't "easing" at all. For many people it's actually getting worse.

When joblessness rose in those recessions, the number of people who were out of the labour market altogether - "economically inactive" - also went up. And stayed high. People stopped looking for work and often never got another job. This time around, inactivity did rise when the recession started, but it's since come down dramatically, even as unemployment has stayed relatively high.

What's driving that change? Some 109,000 of that 285,000 fall is due to a a smaller number claiming to be retired, the squeeze in pension pay-outs must be playing a role in that. In a flat economy, the message of today's numbers is that the jobs market is starting to look rather flat as well.

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