Jobless Claimants Rise at Fastest in 16 Years

The number of people claiming unemployment benefit rose in July at the fastest rate for almost 16 years as the UK jobs market came under increasing strain.

The Office for National Statistics’ monthly labour data published on Wednesday showed that the claimant count rose by just over 20,000 to 864,700. It was the sixth month in succession that the number rose. The rise however was still below levels prevailing in the early 1990s, when monthly increases in the claimant count of 50,000 were common.

The unemployment rate, the best measure of joblessness, also increased by 0.2 percentage point to 5.4 per cent, compared with the previous three monthly period.

The number of job vacancies also dipped by 47,400 to 634,900. Unemployment is expected to continue to rise as the economy slows and redundancies announced by building companies and financial institutions in particular start to take effect.

It was not all bad news. Total employment despite the rise in joblessness also rose by 20,000 to 29.56m during the three months to the end of June. The employment rate however was 0.1 percentage point lower than the previous three months at 74.8 per cent.

A fall in the rate of annual increase in average earnings, including bonuses, down by 0.4 percentage point to 3.4 per cent should also comfort the Bank of England’s interest-rate setting Monetary Policy Committee.

Jobless Claimants Rise at Fastest in 16 Years, Financial Times
8/13/2008 6:34:23 AM