Recovery fears as jobless toll rises

A PRE-Christmas surge in unemployment has amplified fears of a rocky economic recovery as public sector cuts sent the national jobless total to 2.5 million.

Across the country, the numbers out of work rose by 35,000 in the past quarter, while in Yorkshire unemployment went up another 1,000 to edge towards 250,000.

Public sector job losses accounted for the national increase, as organisations prepare for severe budget cuts over the coming years.

The release of the figures sparked clashes in the House of Commons between David Cameron and Ed Miliband over the coalition's approach to the economy, the Labour leader calling for next month's 2.5 per cent VAT increase to be cancelled.

Budget cuts for councils and police forces announced this week are likely to lead to a wave of public sector job losses next year, although Ministers hope their plans will see more jobs created in the private sector to offset it.

Mr Miliband said the 35,000 rise in unemployment in the year to October was a cause for concern and said claims that Britain is "out of the danger zone" would "seem very hollow" to families affected.

The Prime Minister said he was "concerned" by the rise in unemployment and said the figures were "disappointing" but claimed the picture was mixed with an extra 10,000 vacancies every day.

"Anyone who loses a job is a tragedy for that person and we must do everything we can to help people into work," he said. "And with the work programme we will be launching the biggest back to work programme in this country for 70 years.

"To be accurate these are, whilst part of the figures are disappointing, they are mixed because we did see the claimant count has come down in the unemployment figures and also we are seeing an increase in the number of vacancies in our economy.

"Over the last six months we have seen 300,000 new private sector jobs. We need more of them and keeping our economy out of the danger zone is the way to get them."

In Yorkshire, unemployment rose by 1,000 to 244,000 in the three months to October, with 9.3 per cent of the potential workforce currently out of a job.

Employment fell by 33,000 compared with the previous quarter, while the number of people claiming Jobseekers Allowance rose by 100 to 144,300 last month.

Ministers insisted their plans to reign in public spending to tackle the deficit were the right way forward, and Employment Minister Chris Grayling refused to speculate on the likelihood of a further surge in unemployment next year.

Nationally 839,000 people have been unemployed for more than a year, up by 41,000 over the three months.

The Office for National Statistics also reported that the number of 16 to 24-year-olds out of work increased by 28,000 to 943,000, one of the highest figures since records began in 1992, giving a jobless rate of 19.8 per cent.

Dr John Philpott, chief economic adviser at the Chartered Institute of Personnel and Development, said: "The latest jobs market figures are much worse than expected and the opposite of what was wanted in the run-up to Christmas, with no joy and very little comfort on offer.

"It is especially disappointing to see the positive momentum that had built up earlier in 2010 appear to run out of steam even before the full impact of the coalition government's spending cuts and tax hikes take effect. This does not bode well for 2011."

Figures showed that public sector employment has fallen by 33,000 to just over six million, including 18,000 in local government and 8,000 in the civil service.