Unemployment in Britain has risen again and is now at 3.7 per cent, up 0.2 per cent on the quarter. It’s a very small change in the grand scheme of things but, perhaps counterintuitively, a change in the right direction.
This morning’s labour market update from the Office for National Statistics shows that while the headline unemployment figure has ticked up, the economic inactivity rate has slightly decreased by 0.1 per cent. This reflects a shift in the status of some working age people – approximately 55,000 between September and November 2022 – from being out of work and not seeking it to actively seeking work. With the redundancy rate slightly up but still ‘low’ according to the ONS – standing at 3.4 per thousand employees – the increase in the unemployment rate can be taken as a sign of more people registering their interest in going to work.
The ONS estimates that it’s largely the youngest workers, aged 16-24, and older workers, aged 50-64, who are looking to enter or re-enter the workforce, mainly because of changes of circumstance among the ‘students, long-term sick, or retired’. Health ailments are currently estimated to be keeping over two million people out of the labour force, contributing to the dramatic rise during the pandemic of over five million people now on some sort of out-of-work benefit (a cost not just in terms of the public finances, but in human potential, which Fraser Nelson looks at in his cover piece in the most recent edition of the magazine). It’s a reminder that, while the government likes to boast that unemployment is still at near record lows, the official figure does not come close to capturing the millions of working age people who, for a variety of reasons, find themselves out of work.