The latest ONS employment stats – what’s the real picture?

As has become a habit since I started writing this blog, I’ve been taking a look at the latest ONS employment statistics. The government will trumpet one or two headline figures that seem favourable, but a closer look at the stats themselves almost invariably reveals a very different picture.

After a strange silence on a slightly positive headline rate last month, which hid a much grimmer reality, the government is back to form this month, with a big fanfare about a decrease in the headline unemployment figure of some 66,000.

As is its usual practice, the government is using the ‘seasonally-adjusted’ numbers, as these will generally look more favourable. As is my usual practice, I’m going to look at the unadjusted figures, as these tell what’s really happening to real people, without any statistical ‘tweaks’, but the same patterns will emerge either way, just to slightly different extents. If you want, you can download the ONS tables yourself and make your own mind up.

Number of unemployed

First, the good news. Looking at the unadjusted figures, the number of unemployed people has – unusually – fallen by more than the government’s seasonally-adjusted figure – by 90,000 rather than 66,000. I’m delighted for every single person who has found a real, decently-paid job. If you’re one of them, congratulations. But the number of such people is nowhere near 66,000, let alone 90,000.

Economic Inactivity

Out of those 90,000 people who are no longer on the register of unemployment, an additional 15,000 became economically inactive. In other words, they don’t have work, but now they can’t get get benefits, either. The coalition’s policies to force people off benefits is clearly working – except they’re not forcing them off benefits and into work, but off benefits and into… well, limbo really. Forced to rely on others to provide for them privately, rather than via taxation and benefits – or else forced into poverty and perhaps destitution if they don’t have someone willing & able to feed and house them.

Vacancies vs unemployment

The reason for this trend is revealed in the spreadsheet showing the number of employed people versus the number of available jobs: as of the end of May, there were over 2.5 million people unemployed, with a grand total of just 467,000 jobs for them to compete for. That’s a ratio of 5.5 people for every available job. Even if we could fill every vacancy, that’s still just under 2.1 million people for whom a job simply doesn’t exist, however much a Tory might want you to think they’re simply skiving.

This statistic demonstrates just how big a fallacy the government’s rhetoric about ‘skivers’ is. They use this to justify a massive attack on benefit claimants, deliberately fostering the notion among the rest of the population that people are unemployed because they’re feckless, lazy, complacently comfortable on over-generous benefits or simply don’t want to work. Take, for example, David Cameron’s many pronouncements, as he trails the latest benefit cuts, about how he wants to support the ‘battlers & strivers, those who work hard and do the right thing‘. So, if you need welfare, it’s because you’re not battling and striving enough, not working hard enough, it’s because you’re doing the wrong thing. Right? Or perhaps it’s because you desperately want to work but you’re not lucky enough to outcompete 4.5 other people going after every job you’ve ever applied for. And if you’re one of those 2.1 million unlucky people for whom there’s no job at all and you can’t qualify for benefits, you join the growing shadow-ranks of the people who aren’t counted as unemployed but can’t find work either. This is a ‘structural deficit’ worth talking about.

Skimming the surface of the pool

While the number of unemployed people fell by 90,000, the people re-entering work came pretty much entirely from the pool of the recently unemployed – the ‘6 months and less’ category. The number of unemployed people rose substantially in all of the categories 6-12 months, 12-24 months and >24 months (this category alone numbers 441,000). This means there’s a rapid churn of short-term unemployed people, and if you lose your job you have a reasonable chance of finding another. But if you’re not able to find one within the first 6 months, your chances decline rapidly – and the government is completely failing to find any solution for those people unemployed longer-term. The very same people that, ‘co-incidentally’, they’re trying to force off benefits into jobs that just don’t exist. Or perhaps they don’t want to solve the problem – a large pool of unemployed people makes the rest of us insecure and allows companies to pay a pittance while saying we ‘should all think ourselves lucky we have a job at all’. They just don’t want to pay for it, either.

Full-time vs part-time; employed vs self-employed

We’ve already seen that of the 90k reduction in people classed as unemployed, 15,000 simply became ‘economically inactive’. What of the rest? Well, if you’ve read the posts I’ve written on the previous 2 months‘ employment statistics, you’ll have a good idea of what to expect. In the quarter up to the end of May, only 29,000 more people went into full-time, employed posts – less than half of the government’s trumpeted 66,000 and less than a third of the unadjusted figure. An increase in the phenomenon of ‘zero-hours’ contracts, so that you’re not guaranteed any work at all, means that the true figures are probably even worse. On a zero-hours contract, you might technically be in full-time employment because you’re expected to be available for a full week’s work if you’re needed, but you might not be needed, and then you don’t get paid . As came out during the testimony of G4S executives to a select committee this week, a lot of the security positions they offer are on this basis – putting all the risk onto the employee so that the penny-pinching employer can squeeze every last bit of profit out of a contract.

An additional 24,000 people went into full-time or part-time ‘self-employment’, but as we’ve seen previously, a ‘self-employed ‘job’ isn’t really a job until you succeed in making a living out of it – until then, you’re off the unemployment register but don’t actually have gainful employment.

Moreover, a lot of companies are forcing people to work on a self-employed basis so that the employers don’t have to pay holiday or sick pay, or national insurance. So don’t listen when Cameron & co crow about increased self-employment numbers showing the ‘great, British entrepreneurial spirit’. In most cases, it just isn’t so.

As for the remainder, 40,000 people went into part-time employed work. continuing the recent shift in the balance of the UK employment market away from better-paid, full-time jobs into poorly-paid, part-time work. When you place this in contrast to the massive increase in the wealth of those who own and run the companies offering this increasingly part-time work, you start to see the scandal of the UK’s inequality and taxation situation for what it really is.

Unpaid work and ‘government-supported training/employment schemes’

In the last quarter, there was an increase of 14,000 in the number of ‘unpaid family workers’, and of 40,000 in government-supported training or employment schemes’. So if you work for free in your dad’s shop, you don’t count as unemployed, but you’re not earning. And an extra 40,000 jobs – a massive increase of 53% on the previous quarter’s total – are not real jobs at all, but rather make-work positions ‘provided’ by the government. Or more likely imposed by the government on the unlucky unemployed. Workfare, anyone?

Don’t dare be disabled or chronically ill!

If you have a disability or limiting chronic illness, you already face an uphill struggle in life compared with the rest of us. But over the last quarter, things got worse. Levels of unemployment and economic inactivity rose in all categories of disabled and chronically sick people – reflecting, probably, the cynical tactics used by companies like ATOS on behalf of the government to force people off disability/sickness benefits and onto jobseeker’s allowance or means-tested benefits even when they’re clearly unable to work, and to put them on a 12-month limit for their JSA if they can’t find work. When there isn’t any. Even for the able-bodied.

London 2012 calling?

The regional statistical breakdown was last updated in February, but it’s a safe bet to say that the trends it shows will have continued and perhaps accelerated since. This breakdown shows a preponderance of any reduction in unemployment – some 50,000 – to be in London. This suggests that it’s highly likely that a large part of any reduction in the latest unemployed numbers is a temporary effect of the impending Olympic games. Undoubtedly, there will be a significant number of jobs generated by the Olympics/Paralympics in the short term. However, since most of the jobs generated will be low-wage, the reality is a massive profit to providers of low-paid, poor-prospect, short-term employment.

Work harder, receive less

Income in both public and private sectors continues to rise very, very slowly – significantly more slowly than inflation. This means that while profits for most companies have held up, individual incomes have reduced in real terms. You may have a job, but the benefits of having one are reducing all the times. The ONS average wage statistics include the financial sector and highly-paid directors and city-workers, whose incomes have continued, for the most part, to rise far faster than the national average. This means that the situation of the average and low-paid worker is significantly worse than the ‘national average’ numbers suggest – and that inequality is accelerating ahead of a trend that was already very fast.

So, how to sum up? Well, I have a headache now, for a start. The latest situation is not without any positive news whatever – but what good news there is is mostly too marginal to even change the first decimal place of the percentages. A look behind the headline number shows that any real improvement is actually wafer-thin – and probably temporary, due to a boost (at very poor value for money) from the Olympics.

As stated, I feel very glad for anyone lucky enough to find themselves in a decently-paid job who wasn’t before. But I’m certainly not persuaded that the coalition government is entitled to use the latest figures as evidence of any kind of improvement in the economy, or in the lot of the 99% of people in this country who don’t belong to the rich ‘elite’. If you think otherwise – well, consider the evidence.


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