Peter Hoskin

The worries behind falling unemployment

The worries behind falling unemployment
Text settings

Expect Labour to make much of today's employment figures, which show that unemployment fell by 7,000 in the three months to last November.  Already, Yvette Cooper has claimed it as a success for "government investment".  While Gordon Brown will surely repeat that message in PMQs.

But is it really testament to government action?  Or is it a result of a naturally improving economy (which, let's not forget, is taking longer in the UK than most other developed nations)?  Well, a study commissioned by the Spectator from Oxford Economics found that Brown's "investment" would "save" around 35,000 jobs in 2009 – but then destroy considerably more jobs from this year on.  Even though there’s been a Budget and a PBR between that study and now, it still gives the lie to Brown's frequent claim that the government has saved hundreds-of-thousands of jobs.    

Besides, as Theresa May pointed out in a well-pitched response to today's news, there are some worrying underlying trends.  For instance, the number of people working part-time rose by 99,000 to an all-time high of 7.71 million.  Are people taking part-time work out of desperation?  And what happens if they start looking for full-time work?  And that's before we think about the high levels of youth unemployment, among other problems.

Of course, falling unemployment is better than rising unemployment.  But – as with many of the economic indicators we're seeing at the moment – there's still plenty of cause for concern.