14 September 2011 – Grayling: growth remains the Government’s priority

New figures published today by the Office for National Statistics show a rise in unemployment (ILO measure) to 2.51 million signalling that the Government must continue with measures to stimulate the economy and encourage growth.

While today’s figures are disappointing unemployment remains lower than it was six months ago. The latest estimates show that the overall numbers of people claiming out of work benefits have fallen over the past year indicating that Government's welfare reforms to get people off benefits are working.

The slowdown in the world economy and fragile financial markets across both Europe and North America is clearly having an impact on the UK economy. Ministers are confident that the private sector can continue to create jobs as it has done consistently over the last year.

The Government is determined to tackle youth unemployment, which is why Ministers have committed to increasing the number of adult apprenticeships by an extra 75,000 a year to give young people a head start in finding and keeping a job with a future.

Employment Minister Chris Grayling said:

"Today’s figures underline the scale of the challenge that we face particularly given slower growth across Europe and North America. Unemployment remains lower than it was six months ago but clearly we must continue to focus our efforts on supporting business growth and ensure that people who do lose their jobs have the best possible support to get back into employment."

The Government is taking the steps needed to support growth and rebalance the economy, including:

• the creation of eleven new Enterprise Zones, designed to boost local growth and create over 30,000 new jobs by 2015;
• providing real incentives for businesses to grow and create job opportunities;
• announcing four annual reductions in corporation tax;
• cutting the small companies rate;
• expanding loan guarantees;
• simplifying health and safety laws;
• investing in science and apprenticeships;
• promoting exports through major trade missions;
• launching the New Enterprise Allowance (NEA) which will help up to 40,000 businesses get up and running;
• supporting work clubs and enterprise clubs across the country;
• reforming the Welfare State to make work pay.

We will ensure that people who lose their jobs get the best possible support available.  Our new Work Programme is now up and running across the country and will offer flexible support tailored to people’s needs to help them get into employment.

Notes to Editors:

Background to labour market statistics: September 2011

This month’s Labour Force Survey covers May to July 2011. The claimant count and Jobcentre Plus vacancy count dates were 11th and 5th August 2011 respectively.

The number of people in work fell this quarter

• 29.17 million people were in work in May to July 2011.
• the employment level was 69 thousand lower than the previous quarter but up 24 thousand on the year.
• the employment rate is 70.5%, down 0.2 points on the quarter, and 0.3 points on the year.
• employment in the private sector rose 41,000 on the quarter and 264,000 on the year.  This was offset by a fall of 111,000 in public sector employment this quarter and 240,000 on the year.

ILO unemployment rose this quarter

• 2.51 million people were ILO unemployed in the May to July quarter, up by 80 thousand on the February to April period and up 44 thousand on the same quarter last year.
• the ILO unemployment rate is 7.9%, up 0.3 percentage points on the quarter and 0.1 percentage points on the year.

The number of people on JSA rose again this month, but the number claiming one of the other main out-of-work benefits is improving:

• claimant unemployment was 1,580.9 thousand in August 2011, up 20.3 thousand on the level in July 2011, and up 114.8 thousand on the year.
• the claimant unemployment rate, at 4.9%, is up 0.1 percentage points on the month and 0.4 percentage points on the year.
• the figures continue to be affected by welfare reform, including the ongoing process to re-assess existing claims for incapacity benefits, and this is likely to have made some contribution to the rise in the JSA caseload.
• in the year to February 2011, the number claiming incapacity benefits fell 36,000 to 2.58 million. The most recent provisional figure for July 2011 suggests the caseload has since fallen further to 2.56 million.
• in the year to February 2011, the number of lone parents on income support fell 78,200 to 613,800. Provisional figures for July 2011 suggest the number has fallen further in recent months, to 595,000, driven by welfare reform.

The level of economic inactivity is up on the quarter and on the year

• the economic inactivity level is 9.4 million, up 11 thousand on the quarter and 112 thousand on the year.
• the economic inactivity rate is 23.3%, unchanged on the quarter but up 0.2 points on the year.
• excluding students, inactivity as a share of the 16-64 population is 17.8%, up 0.2 percentage points on the quarter and on the year.

The number of redundancies rose this quarter and the number of unfilled vacancies fell

• There were 162 thousand redundancies in May to July 2011, up 47 thousand on the previous quarter and 21 thousand on the year.
• ONS’s vacancy survey estimates an average of 453 thousand unfilled vacancies in the three months to August 2011, down 6 thousand on the quarter and 11 thousand on the year.

Total weekly pay in May to July was up by 2.8% over the year

• growth in regular weekly pay, excluding bonuses, was up 2.1% on the year.

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