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Unemployment drops for first time in 18 months

By Ben King

Updated on 20 January 2010

Unemployment has fallen to 2.46 million in the three months to November, down 7,000 on the previous three months - the first fall since the recession began.

Unemployment (Credit: Getty)

Despite predictions in many quarters that 3 million people would find thsemvelves out of work as a result of the recession, the number claiming jobseeker's allowance is also down.

The number of people unemployed has fallen unexpectedly for the first time in 18 months.

But part-time working has risen, with more than one million people now in this positions because they cannot find full-time jobs.

The figures from the Office for National Statistics also revealed a drop of 16,000 in the number of jobless people aged between 16-24.
 
The figures showed the number of people claiming jobseeker's allowance fell for the second month in a row by 15,200 to 1.61 million.

This will release some pressure on the strained public finances, as it means a lower amount of unemployment benefit will need to be paid out.

Unemployment had been expected to continue to rise for 12 months following the end of the recession, which has still to officially end in the UK.
 
The Work and Pensions Secretary Yvette Cooper said: "The jobs market is still tough for a lot of people, but the drop in unemployment and youth unemployment is very welcome.

"It means 450,000 fewer people are out of work than everyone expected last spring."

Early forecasts had suggested unemployment could reach three million, but the peak now looks likely to fall well short of that figure.

The number of people taking part-time work instead of becoming fully unemployed is one factor which explains the difference.

'A long way to go'
However there have been warnings warn that despite today's figures, the employment picture is still dire.

The number of people classed as "economically inactive" rose to a record high of 8.05 million in the three months to November.

This includes the early retired, and those not looking for work. A rise in the number of students not seeking work reached a record high of 2.24 million.

Shadow work and pensions secretary Theresa May said: "Any fall in the level of unemployment is welcome news, but today's figures are still real cause for concern.

Economic inactivity has hit a record high and there are 2.3 million people out there, out of work and who want a job, but aren't included in the unemployment figures. We still have a long way to go to undo the damage done by Labour's recession."

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