14 Mar 2012

Q+A: What the latest jobs figures mean for the UK

As job creation becomes a crucial issue in 2012, Channel 4 News looks behind the headlines at how the UK is faring in the first quarter of the year.

Q+A: What the latest jobs figures mean for the UK

How many jobs does the UK need?

The number of unemployed in the UK at the beginning of 2012 stands at 2.67 million – the highest level in nearly 17 years, at 8.4 per cent of the “economically active” population. The latest ONS figures show another rise in the number of young people looking for work – 22.5 per cent of the 16-24 age range out of work.

To put this in context, unemployment stayed around the 1.5 to 1.6 million mark between 2000 and 2005. It reached a peak of 3.28 million in the second quarter of 1984. Channel 4 News will be tracking trends over the next year, to see how things change for the unemployed, the employers and the employees in the UK.

Why is unemployment so high?

The rate of unemployment is a marker of the health of the economy – and at the moment, it is high because growth is low and the economy is depressed. Depending on who you believe, this is exacerbated by the crisis in the eurozone or the government’s “austerity” measures, and policy of cutting the public sector.

For youth unemployment however, the high unemployment rate is boosted by those in full-time education, who still show up in the figures. While it’s still a phenomenally high number, the total number doesn’t tell the whole picture.

FactCheck: Youth unemployment – how bad is it really?

How can the number of employed, rise at the same time as the unemployed?

Recent figures from the Office of National Statistics (ONS) highlight a surprising trend – while unemployment has risen by over 220,000 over the past two years, there has also been a slight boost in the number of people in employment.

This is partly because the working-age population is slightly bigger. And also because some of those who were previously classed as “economically inactive” – stay-at-home parents, or carers – have re-entered the workplace, or have started looking for work.

If the employed figures are broken down, they show that there has been a rise of part-time workers and self-employed. A record number of 7.9 million people now work part-time – 1.4 million of which are doing so because they are unable to find full-time work. This impacts on employment figures as two people, who together make up the hours of just one post, will nonetheless both be counted as “employed”.

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When it comes to jobs, is quantity more important than quality?

Business and economics experts have warned that the focus on quantity ignores the need for more high-skilled, quality jobs. The recent news about job claimants on the government’s Work Programme being forced to do low-skilled jobs – or risk having their benefits removed – highlights the plight of job-seekers who are looking for skilled jobs with progression.

The sectors that are expected to grow – for example social care or hospitality – offer low wages and provide little opportunity to progress from a basic level. Some experts are worried that even if we create enough jobs, they won’t provide long-term opportunities, especially for those without qualifications. This is the challenge facing the UK economy in 2012.

Latest figures: UK unemployment rises by 28,000

Which sectors look the most promising for jobs creation?

Employers have so far talked about a need for skilled employees in mechanical engineering, as well as electronics. And in recent weeks, announcements from some of the ‘Big Four’ supermarkets show that the retail sector holds some hope for job-seekers at various levels, as well as from car manufacturers Nissan and Jaguar Land Rover.

But are there more sectors with skills gaps lurking behind the headlines? We’ll be finding out what areas job-seekers should be looking for vacancies, what makes a successful applicant – and the sectors that look set to boom.