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UK unemployment at 8.4%

During Brown’s government, unemployment was on the decline, now figures published by the Office for National Statistics (ONS), show that UK unemployment rose by 28,000 to 2.67 million during the three months to January. The unemployment rate currently stands at 8.4%. Youth unemployment (16-24 year olds) rose by 16,000 to 1.042 million, a rate of 22.5%. In addition to this, the number of people claiming Job Seeker’s Allowance increased by 7,200 to 1.61 million in February.

Regardless of these alarming figures, the government see this as an improvement with the rise of unemployment being at its lowest in a year, showing signs that the Labour market is stabilising. The ONS also showed a small increase in the number of people in work – up by 9,000 in the three months to January.

The Coalition government believes that they need to encourage responsibility and fairness in the system, meaning providing help for those who cannot work, training and targeted support for those looking for work, but sanctions for those who turn down reasonable offers for work or training. They plan to do this by:

  • Ending all existing Welfare to Work programmes and creating one Work Programme to get all unemployed people back into work.
  • Supporting all would-be entrepreneurs through a new programme – Work for Yourself –which will give the unemployed access to business mentors and start-up loans.
  •  Offering work experience placements at companies with their new work scheme.

They hope their reforms will promote high levels of employment by helping people who are out of work, including people in disadvantaged groups, to move into work.

The work programme, whereby private contractors are paid by results if they help jobseekers find work has, faced criticisms. There are fears that targets are unrealistic during the downturn, too many jobs found are part-time, and there have been allegations of fraud at one provider, A4e.

Labour has also decided to take a hard-line position on welfare with plans to stops benefits if job offers are refused. Labour has said it would withdraw welfare benefits from the unemployed for six months if they refuse a government-provided job guarantee after completing a placement on the work programme. Shadow Work and Pensions secretary, Liam Byre, stated ‘A right to work must carry with it a responsibility to work’.

Labours tough stance follows a government U-turn over its work experience programme, where it bowed to pressure from big business and dropped benefit sanctions against young people on the scheme. Businesses had threatened to withdraw from the scheme unless the government dropped plans to penalise young people who dropped out of the eight week programme by withdrawing their JSA for two weeks.

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