18 May 2005 - Labour market is strongest for decades - Hodge
Margaret Hodge, new Minister of State for Work, today welcomed official figures showing the strength of the UK labour market. She said:
“Today’s figures mean we start the government’s historic third term with the strongest labour market for decades: employment at near record levels and unemployment the lowest for thirty years. With nearly three quarters of working age people in work, we have the highest employment rate of the major world economies.”
There are 28.6 million people in work, up 183 thousand on a year ago. In the last year, rising employment has meant fewer people unemployed: the ILO measure of unemployment has fallen 23 thousand to 1.4 million. The number claiming Jobseeker’s Allowance in April 2005 was 839,400, up 8.1 thousand on the month but down 32.1 thousand on the same month last year.
“Our first term was about tackling the high levels of long-term unemployment that were the legacy of boom and bust. Long-term unemployment is now just a quarter of the level it was in 1997 and long-term youth unemployment has been virtually eradicated,” Margaret Hodge continued.
“Our second term was about extending help and support to others on benefit, especially single parents and people with a health problem or disability. The number of lone parents on benefit is down more than a fifth since 1997 and the last year has seen the number of people claiming incapacity benefits falling after more than two decades of substantial growth.”
The number of people claiming incapacity benefits fell 22 thousand in the year to November 2004, to 2.64 million. There are 763 thousand lone parents claiming income support, down 36 thousand over the same period.
“Our new term is about building on the success of our economic and welfare to work policies of the last eight years. Not just by extending opportunity further but by extending opportunity to all. We have set our sights on an employment rate of 80 per cent. This is an ambitious, long-term aim but the process of achieving it starts now,” Margaret Hodge concluded.
Notes for editors
Background to labour market statistics: May 2005 Compared to this time last year there are more people in work, fewer people unemployed and fewer people on other out-of–work benefits. Vacancies remain at historically high levels and redundancies are around the lowest on record.
This month’s Labour Force Survey covers January to March 2005. The claimant unemployment count date was 14th April and the vacancy count date was 8th April.
In January to March 2005, employment rose by 87 thousand on the previous quarter and 183 thousand on the year. ILO unemployment was down in the latest quarter and down on the year. Claimant unemployment was up in the latest month but down on the year.
The labour market is in a strong position
- There were 28.6 million people in work in January to March.
- The LFS employment rate is 74.9%, the same as last quarter and this time last year.
- On both measures, recent unemployment rates are the best since 1975.
- Both the ONS and Jobcentre Plus series show vacancies at high levels.
- There were 133 thousand redundancies in January to March, compared to 137 thousand in the same period last year.
Over the last year employment is up and unemployment and inactivity have improved
- Employment is up by 183 thousand over the last year.
- ILO unemployment in January to March was 1.396 million, down 15 thousand in the last three months and 23 thousand on this time last year. The ILO unemployment rate is 4.7%, down 0.1 percentage points from the previous quarter and down 0.1 percentage points on the same period a year ago.
- Despite an improving labour market and rising employment, the latest claimant count figures show 839.4 thousand JSA claimants in April 2005, a rise of 8,100 on the month. This increase is not the result of a rise in redundancies, or a pick-up in the number of new claims for JSA. The claimant count remains 32,100 lower than a year ago.
- ILO unemployment fell this quarter because the increase in the labour force (+72,000) was less than the substantial rise in employment (+87,000). The 15,000 decline in ILO unemployment is the difference between these two figures.
- The number of economically inactive people of working age rose by 14 thousand this quarter. This reflected population growth, as the inactivity rate remained unchanged at 21.4%.
- Over the last year as a whole employment has increased, unemployment has fallen and, excluding students, the number of economically inactive people also fell.
The number of vacancies remains high
- ONS’s vacancy survey estimates there were 628.9 thousand unfilled vacancies in the quarter to March 2005, up 5,600 (0.6%) on the same period last year.
- Jobcentre Plus vacancies in April 2005 were 284,757, compared to 291,757 in the same month last year. More than 10,000 new vacancies are placed at Jobcentre Plus every working day and at least as many again come up through other recruitment channels.
Earnings growth in the year to March was 4.6%, down 0.1 percentage points from February
- Excluding bonuses, average earnings growth was 4.1%, down 0.2 percentage points from February.
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