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Tuesday, 12 May 2009

Unemployment up 12% in 3 months

The new unemployment figures slipped out a day early today, supposedly by accident but more likely because it was a good day to bury bad news.

The bad news is that the number of unemployed has risen to 2.22 million, up 244,000. Well that was where we were at the end of March, 45 days ago, but at that rate you can figure another 100,000 since then. And then you can add in all the economically inactive and those on incapacity benefits. I have lost count.

The Employment Minister Tony McNulty conceded that the figures were very bad, but took some comfort from the slowing rate of increase in the claimant count. Yeah well, duh! The fewer people there are in work, the fewer there are to be laid off, so of course the rate of increase in the claimant count will slow down. It's like an inverse exponential decay.

No doubt we will hear from the Prime Minister that there are more people in work than there were under the previous administration. Again duh! There are more people in the country, but a lower proportion in gainful employment.

More lack of objectivity from the FT who describe declining out put as "improving data" and that the UK economy is "past the worst of the recession", when in reality the economic indicators are merely not falling as fast as before.

They report that this is the first month that the monthly Gross Domestic Product estimate has not fallen since April of last year. Well, whoop-di-woo, with government spending in the current budget cycle 6% higher than last year and all the government departments rushing to spend their annual budget before the end of the financial year, you would have to have a private sector falling at something over 7% to give a flat GDP. Which we have.

NIESR estimates that overall output has fallen by 4.8 per cent so far in the recession, meaning that it is not declining as quickly as the 1929-34 recession, but is still sinking faster than during the recession that began in 1979, but then government spending wasn't pushing 50% of GDP 1in the 1930's.

The FT goes on to say the output of the UK manufacturing industry recorded its smallest decline in 13 months, helping overall industrial production to fall by a less-than-expected 0.6 per cent. Again, wowee, that is an annualised 7.2%, which is hardly boom time. Those 224,000 net job losses in the last 3 months didn't come from the public sector - expect those in the figures starting from the beginning of the new financial year in April - so don't expect industrial production to start increasing any time soon.


Not a sheep said...

Damn you, I had the same thought when I heard this news but forgot to post it - I have the attention span of a gnat these days.

Demetrius said...

According to my calculations, most of these will be needed for duties in security for the 2012 Olympics, so they should not have long to wait. Check the blog today.