125,000 jobless drop – good news but not good enough
Another fall in unemployment – but recovery is not coming as fast as the government had hoped
DAVID CAMERON has hailed as more good news on the economy this morning's release of quarterly unemployment figures which show a further fall of 125,000 to a total 2.34 million out of work.
The PM tweeted: "It's good to see another fall in unemployment. Our long-term economic plan means more people with the security of a wage and a chance in life." Employment minister Esther McVey said: "We are on the right path, and going in the right direction."
But there was a note of caution from the Office of National Statistics which released the figures. While the Bank of England remains confident unemployment will continue to fall, the ONS said the main conclusion from today's figures was that "the rate at which unemployment has been falling is likely to have slowed down".
And because the size of the labour market is constantly changing (affected by fluctuations in EU immigration and the number of people retiring, for instance) the percentage of unemployed for the quarter October-December is actually up at 7.2 from 7.1 for the September-November quarter.
Still, the headline figure of another 125,000 people coming off the dole queue comes as a boost to Cameron as he visits more flood-hit areas today.
It is unclear how badly the economy will be affected by the floods, but there is some relief in Whitehall that the waters are at last beginning to recede.
As for how the authorities have dealt with the flooding, and how that could impact on the Tories and Lib Dems in upcoming elections, Cameron badly needed a lift after an ITN/Comres poll showed that 63 per cent of voters believe the government’s reputation for competence has been damaged by its handling of the flooding crisis.
Overall, the new jobless figures show that while the recovery is continuing, it may not be as spectacularly fast as the government hoped last month.
Of particular concern is the failure to radically deal with youth unemployment. Yes, the number of young people aged between 16 and 24 out of work fell by 48,000. But there were still 917,000 of them unemployed at the end of December – enough to have Radio 4's Today programme discussing the "wasted generation" this morning and to allow Labour to argue that the coalition austerity measures have failed this generation.
Shadow employment secretary Rachel Reeves told the BBC: "There have been improvements in the last few months and that is incredibly welcome but this is not the time to take the foot off the gas. There is still a lot to be done to tackle long-term youth unemployment. There is a danger of it turning into a lifetime of unemployment."
Reeves urged the government to adopt Labour's plan to give all young people a job if they had been out of work for over a year.
Today's figures also show that the "cost of living crisis" highlighted by Labour leader Ed Miliband remains a factor. Wages rose during the quarter from 0.9 per cent to 1.1 per cent but they are still below the inflation rate of 1.9 per cent, leaving many people in work feeling worse off.
For Cameron, it is now a question of timing – will wages creep up enough, and will the jobless figure fall further enough, for the majority of voters to be enjoying the "feel good factor" by polling day in May 2015? ·