U.K. Unemployment Rises to Highest Level in 12 Years

U.K. unemployment rose to the highest level since Prime Minister Gordon Brown's Labour Party came to power in 1997 as the recession forced companies from builders to car makers to axe jobs.
TradingEconomics.com, Bloomberg 4/22/2009 5:26:48 AM

The number of jobless based on International Labour Organization methods rose 177,000 in the three months through February to 2.1 million, the most in 12 years, the Office for National Statistics said today. Claims for jobless benefits rose 73,700 in March to 1.46 million.

Brown has pledged help for the unemployed in the annual budget today as the worst recession in at least three decades destroys jobs at car factories, building firms and banks. Trailing in opinion polls, Brown faces the prospect of fighting the next election with one in 10 people of employment age out of work for the first time since 1994.

Banks and insurers in London may eliminate about 29,000 jobs this year, 9 percent of the total, before employment growth resumes in 2010, the Centre for Economics & Business Research Ltd. said in a report on April 20.

WS Atkins Plc, the biggest U.K. engineering-design company, said on April 15 it increased job cuts to 1,200 on slumping construction markets in Britain and the Middle East.

In the three months through February, the ILO jobless rate in Britain rose to 6.7 percent, the highest since October 1997. That compares with 8.5 percent in the 16-nation euro region, 8.5 percent in the U.S. in March and 4.4 percent in Japan.

Claimant unemployment rose for a 13th month in March, the longest stretch since the 16-month period to June 2006. The increase in February was revised to 136,600 from 138,400. The jobless rate rose to 4.5 percent in March, the most since August 1998, from 4.3 percent in February.

Wage pressures subsided as banks slashed bonuses. In the three months through February, pay growth slumped to 0.1 percent from a year earlier, the lowest since comparable records began in 1991. Excluding bonuses, the pace of increase slowed to 3.2 percent, the least since records began in 2001, from 3.5 percent.

U.K. Unemployment Rises to Highest Level in 12 Years