Press Story

Ahead of the latest unemployment figures (on Weds), the extend of 'hidden unemployment' is revealed by new analysis from the think tank IPPR.

The latest UK unemployment figures showed a small but welcome drop in overall unemployment, down 7,000 but the jobless total remains 2.59 million (8.1 per cent), with more than a million young people out of work. Unemployment is 61,000 higher than a year ago and 117,000 higher than two years ago.

There are over 1.4 million part-time workers who say that are willing to work full-time, another 658,000 temporary workers who would prefer full-time work and a significant number of self-employed people who would prefer to be in employment.

The number of people out of work for more than a year in the UK is the worst since 1996, up by 22,000 to 904,000, representing more than a third of the unemployed total. IPPR research has shown that the lingering effects of long-term unemployment can have a 'scarring' effect, making it more difficult to move into employment in the future.

Worryingly, the number of young people (16-24) out of work in the UK has risen for the first time since the Government introduced the Youth Contract, raising questions about how effectively the policy is being implemented. UK youth unemployment remains over a million (1,017,000), up 7,000 since the last quarter and up 37,000 in the last year. A total of 266,000 young people have been unemployed for more than a year, a worrying increase of 31,000 over the last year and 23,000 over the last quarter.

The number of people in the UK working part-time but who say they want to work full time is at a new all-time high of 1,424,000.

Tony Dolphin, IPPR Chief Economist, said:

"Even if the economic recovery picks up momentum in 2013, there is no guarantee things will get any better for young people and the long-term unemployed. Hundreds of thousands are at risk of permanent 'scarring' in the labour market: having their long-term outlook damaged by long periods of unemployment or by a difficult and patchy entry into the world of work. The government should guarantee a job, paid at the minimum wage or above, to anyone who has been out of work and claiming JSA for more than 12 consecutive months. If people do not want to take up this offer, they should be expected to find an alternative that does not involve claiming JSA."

IPPR wants to see new UK infrastructure investment in social and affordable housing, low-carbon electricity generation, transport and super-fast broadband. IPPR also wants a job guarantee scheme, paid at the minimum wage or above, to anyone who has been out of work and claiming JSA for more than 12 consecutive months. The guarantee would be accompanied by an obligation to take up the offer. Jobs could be provided by the third sector or in local government.

IPPR North analysis shows the number unemployed across the UK compared to a year ago is:

Yorkshire and Humber = 28,000 more people unemployed
North West = 27,000 more people unemployed
North East = 4,000 fewer people unemployed
South East = 24,000 more people unemployed
East Midlands = 6,000 more people unemployed
East of England = 4,000 more people unemployed
West Midlands =1,000 fewer people unemployed
London = 32,000 fewer people unemployed
South West = 24,000 fewer people unemployed
Wales = 9,000 more people unemployed
Scotland = 16,000 more people unemployed

Notes to editors:

The latest UK unemployment figures are available from: http://ons.gov.uk/ons/rel/lms/labour-market-statistics/september-2012/index.html

IPPR's report - Jobs for the Future: The path back to full employment in the UK - is available from http://www.ippr.org/publications/55/7938/jobs-for-the-future-the-path-back-to-full-employment-in-the-uk

IPPR's report - A path back to growth - is available from: http://ippr.org/publication/55/9438/a-path-back-to-growth

IPPR North's interim report of the Northern Economic Futures Commission is available from: http://ippr.org/publications/55/8992/northern-prosperity-is-national-prosperity-nefc-interim-report

Contact:

Richard Darlington, 07525 481 602, r.darlington@ippr.org