Yorkshire leads surprise trend as jobless total falls by 45,000

Yorkshire saw the UK’s biggest drop at nine per cent or 24,000 - leaving the total out of work in the region at 241,000.

Nationally, the jobless total was 2.6 million in the quarter to March, the lowest since last summer, while the number of people claiming jobseeker’s allowance last month was down by 13,700 to 1.59 million.

The number of people in work increased by 105,000 to almost 30 million, but this was entirely due to a rise in part-time workers.

Almost eight million people are now in a part-time job, the highest since records began in 1992, while those working part-time because they cannot find full-time work increased by 73,000 to a record high of 1.4 million.

Self-employment has also reached a record figure of 4.1 million, up by 89,000 since the previous quarter.

Average earnings increased by 0.6% in the year to March, down by 0.5 percentage points on the previous month because of lower bonuses in the private sector.

Average weekly pay in private firms in March was £2 lower at £460 compared to a year ago.

The 13,700 fall in the so-called claimant count last month was the biggest since July 2010.

But other figures from the Office for National Statistics showed that the number of people unemployed for more than a year increased by 27,000 to 887,000, the worst total since 1996.

In the three months to March, a third of all unemployed people had been out of work for more than a year.

The number of people unemployed for more than two years rose by 5,000 to 428,000.

The UK’s unemployment rate has fallen by 0.2% to 8.2%, lower than the European average of 10.2%.

Spain has the highest unemployment rate in the EU at 24.1%, while Austria has the lowest at 4%.

Youth unemployment has also fallen, down by 17,000 over the latest quarter to 1.02 million.

There were 9.25 million economically inactive people in the three months to March, a fall of 35,000, mainly due to a reduction in the number of people under the age of 65 taking retirement, as employees work longer and the female state pension age increases.

Employment Minister Chris Grayling said: “These figures are a welcome step in the right direction. For a number of months now, employment has been growing and this is starting to feed through into improving unemployment figures.

“However, we still face significant international uncertainty so we need to hold firm on our current economic strategy and continue to do everything we can to ensure unemployment continues to fall.”

Paul Kenny, general secretary of the GMB union, said: “That there are 2.63 million people without jobs shows the extent to which the Government’s gamble with the economy has failed. So instead of borrowing to support the economy and to continue the recovery the Government has had to borrow to fund the recession.

“We have spent the last two years going backwards and this is why the electorate have voted down this failed policy.”

John Salt, director at totaljobs.com, said: “Today’s statistics are proof, if it were needed, that not all that glitters is gold. The fall in unemployment barely dents the ranks of the jobless, whilst the number of under-employed - those forced into part-time work or self-employment - continues to grow relentlessly.

“There is simply not the consumer demand nor the business confidence that would prompt the private sector investment needed to offset previous job cuts.”

TUC general secretary Brendan Barber said: “Today’s figures are mixed, with the welcome fall in unemployment driven entirely by part-time jobs.

“However the collapse in wages is terrible news for those in work and threatens our chances of an economic recovery.

“The falling number of full-time jobs and the 6% fall in real wages over the last two years means that people are having to make huge salary sacrifices and put their careers on hold just to stay in work.

“People’s incomes and job security today are barely any better than they were at the height of the financial crash. Unless governments act together and stop our austerity misery spiral, the UK’s economic depression will continue for far longer than feared.”

Ian Brinkley, director at The Work Foundation, said: “These are surprising but very welcome figures. Claims that further deregulation of the labour market is needed to stimulate job generation look to be unjustified. Private sector employers clearly felt confident enough to hire in large numbers over the three months to March 2012.

“However, the overall numbers disguise some underlying weaknesses. The economy is still shedding full-time jobs, with all the increase accounted for by part-time work. The latest figures confirm that underemployment is emerging as a significant problem in the UK labour market, with the number of people in part-time work because they could not find a full-time job up by 33% over the past two years.”

Dave Prentis, general secretary of Unison, said: “The small fall in unemployment is cold comfort for the millions of people who cannot find work. Every job lost is a personal tragedy and it’s still women and young people who are bearing the brunt of the recession.

“Unemployment may have fallen but we still face the worst jobs crisis in a generation. A huge growth in part-time working and in people accepting lower pay is masking the real impact of austerity. No wonder growth has stalled and we are back in recession. We need real action to boost growth and create jobs to jump-start the UK out of recession.”

Shadow Work and Pensions Secretary Liam Byrne, said: “Any increase in employment is welcome, but today’s figures show that hard working Britain is doing anything and everything to battle through this double-dip recession made in Downing Street by David Cameron and George Osborne’s failed economic policies.

“Part-time work and self-employment has now hit record highs as British families pull out all the stops to make ends meet.

“It is really worrying to see the soaring long-term costs as the number of long term unemployed surges towards the one million mark - the highest since the Tories were in Government last time.

“Long-term youth unemployment is twice the level of last year and the overall claimant count is 100,000 higher than last year. More worrying for the outlook is that the number of redundancies has surged to 50,000 more than last year and the number of vacancies is down by over 10,000.”

David Kern, chief economist at the British Chambers of Commerce, said: “With the eurozone crisis worsening and economic pressures facing the UK, these figures are encouraging. But there are still some worrying features. Youth unemployment, though down, remains above one million which is a jobless rate for young people of more than 20%. The number of people working part-time because they could not find a full-time job has risen further to a new record high. And although any rise in employment is positive, the bulk of this increase was made up of part-time jobs and self-employment.

“We should be encouraged by these figures as they show the private sector is able to drive recovery while the public sector continues to shrink. But future challenges cannot be overlooked. Businesses are working hard to expand and grow, but the Government needs to do more to help them create jobs. Measures like real de-regulation, and the creation of a business bank to help improve access to finance, will boost confidence and encourage firms to invest and create jobs and growth.”

Graeme Leach, chief economist at the Institute of Directors, said: “These figures raise half a cheer for the economy. Both headline unemployment measures are down, which is obviously good news, but there’s bad news in the average earnings figures.

“The real squeeze in household incomes continues to act as a dragging anchor on consumption and high street spending.”