The latest 3 monthly unemployment figures came out recently. They show unemployment fell by 51,000 to 2.61m in the three months to April. Meanwhile employment rose, in the same period, by 166,000 to 29.28m.
The rise in employment was driven by a rise of 205,000 in private sector jobs, which easily outweighed a 39,000 fall in public sector employment. This fits with the longer term trend, as over the past 2 years private sector employment has risen by 843,000, almost double the fall in public sector employment (424,000) over the same period.
The combination of negative economic growth figures in the past two quarters and this rapid growth of employment seems to make very little sense. Previous experience indicates that employment only starts to recover a year or two after healthy growth has become established following a recession and certainly not during it. So, how come private sector employment is growing at all, let alone by 205,000 a quarter? My view is that this simply isn’t plausible and one set of figures is wrong. Since employment is far easier to measure than growth, the likelihood is that the growth figures are wrong and we aren’t in a double dip recession at all.
That said, the outlook continues to look worrying as the seemingly endless eurozone crisis lurches on, threatening our main export market with a serious decline. There was a hint of this in the May claimant count (only one part of unemployment) figures with seasonally adjusted unemployment rising by 8,100 to 1,599,300 nationally. In Birmingham the seasonally adjusted claimant figure rose by 310 to 50.686. More locally, the Acocks Green unadjusted claimant figure rose by 29 to 1,181 or 10.5%
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