Since last summer, the number of people claiming Jobseeker's Allowance for over six or twelve months has been rising. This matters because the longer someone spends out of work the harder it is for them to get back into it. In July of last year, there were 237,000 claimants who had not had a job in the previous six months. That figure is now 313,000. Many of them will now be part of the population of claimants who have been out of work for twelve months or more, a number which has risen by around 15% to 113,000. Do not be fooled by the difference between the figures – many claimants will have just re-started their claims after a short break in order to avoid the extra demands from the system that come with being out of work for a long time.
Unemployment has devastating consequences for the people who bear it for years on end. If another generation suffer those consequences, our welfare reformers of the past decade will have failed.
When Alistair Darling stands up at the despatch box next week, he will claim the opposite. As he talks about the extra £1.5 billion that is likely to be given to the companies bidding for the Flexible New Deal contracts (FND), he will say that Labour is doing its best to fight unemployment. In one sense, he will be right: using private firms to provide employment services is a good idea. But he will not state what is most obvious: that the extra money will be for all the extra people that are now moving from short- to long-term unemployment and that by the time someone reaches the FND stage (which a Jobseeker’s Allowance claimant reaches 12 months after an initial request for money), the Government will have already failed. There is no sense in which the Jobcentre Plus can be said to have helped a claimant if he has not found a job within that year. Future welfare reformers might want to try something different.
Lawrence Kay is a Research Fellow in the Policy Exchange Economics Unit.