Coffee House

Good news on employment, but don’t expect it to keep coming

20 February 2013

2:03 PM

20 February 2013

2:03 PM

Today’s jobs figures are pretty unambiguously good news. The number of people in work rose by 154,000 in the last three months of 2012 to a new record high of 29.73 million — surpassing pre-recession peak by 158,000. And unlike other recent rounds of employment growth, this wasn’t driven by a rise in part-time workers (their number actually fell by 43,000).

But there are still a couple of reasons cause to greet this good news with caution. Rising employment at a time of economic stagnation has come at the expense of earnings. Adjusted for CPI inflation, average weekly earnings have fallen by 7 per cent in the last five years, back to 2004 levels. And the Office for Budget Responsibility doesn’t expect them to start rising again until late-2014.

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And there’s the fact that the recent rise in employment is not expected to continue in 2013. The OBR expects the employment level to stay flat this year, before starting to grow again in 2014.

 

As a result, it predicts that the unemployment rate — now at 7.8 per cent, down from 8.4 per cent a year ago — will go back up to 8.3 per cent by the summer, and stay above 8 per cent until 2015.

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Show comments
  • Jebediah

    More Jones double think: Why good news is really bad. You really are a tireless misrepresenter aren’t you?

  • treborc1

    That great socialist Liam Byrne today stated if labour, (god forgive gets back in) Labour would only allow two years on JSA then if a person has not found a job labour would make one. Is that not one of the problems from New labour, although of course this is not New labour according to Miliband, did not New labour and Miliband not make jobs in the public sector which were not real, so called non jobs.

    Labour cannot help it, they will tell you they are not new labour but cannot yet break away mainly because most of the politicians are of course Blairites.

  • CharlietheChump

    The OBR expects . . .
    The OBR expected 4G receipts at £3.5bn but that didn’t happen either.

    • Daniel Maris

      If the OBR predicts something, the safest bet is to assume the opposite will happen.

    • HooksLaw

      and 4G sales elsewhere in the world?

      • http://www.facebook.com/profile.php?id=100004981542519 Tom Tom

        4G is not a uniform technology unlike 3G and requires different handsets in different markets. It is a farce and will be supplanted by Wi-Fi as Skype rolls it out

  • JMckechnie

    The elephant in the room is that a lot of jobs aren’t really jobs at all; and a lot of work isn’t really work. We have pretend jobs, jobs not worthy of being called work, and it is all because this country hardly manufactures anything. We have a liquidised economy, full of intangibles that really don’t matter a great deal to anyone. We are going through the motions because no one really believes this country can achieve a great deal anymore. Our greatest economic error was that we frowned on our manufacturing capabilities; and as a result we are laden with ghost towns and cities that have very little reason to justify their existence.

    • telemachus

      No we did not frown on our manufacturing capabilities
      Thatcher destroyed them

      • Colonel Mustard

        Yet more tripe. I’m really quite surprised the Spectator put up with you.

      • http://www.facebook.com/profile.php?id=100004981542519 Tom Tom

        No The City did by consolidating to oblivion. what The City did not destroy Government did. It was Benn that forced the largest truckmaker in Europe – the one Mercedes feared – LEYLAND into a merger with British Motor Corporation (BMC). It was GEC that was allowed to swallow AEI and then English Electric before The City found John Mayo and Lord Simpson (Labour) to destroy GEC.

        • Chris lancashire

          On a point of fact, Lord Simpson was ex-British Leyland. He wasn’t much good there either.

          • http://www.facebook.com/profile.php?id=100004981542519 Tom Tom

            There is a whole coterie of BL managers who seem to have developed a Mafia mentality there and taken it to other businesses – it is an extensive list that libel laws keep discreet

          • Makroon

            Let’s put the blame where it should be – Arnold Weinstock destroyed the British Electrical/Electronics industry by “consolidating it away”. The result of putting accountants in charge.
            Probably would have gone anyway, to be fair.

        • telemachus

          But it all came to fruition and the house of cards collapsed in the 79-91 Government

          • DWWolds

            And you forget people like Red Robbo and Scargill plus sundry far lefties who destroyed companies like British Leyland and the mining sector.

            • telemachus

              Absolutely not true
              There will always be Red Robbos
              What was lacking was effective management with no interest beyond maximising shareholder dividends

            • Chris lancashire

              Actually it wasn’t just them. Brainless tele has half a point. The management was pretty useless and the unions were out of control. When you reach that point it is extremely difficult to regain control. Tele is completely wrong on the rest – the Company was in no position to pay dividends and the “shareholder” was the long-suffering government (aka the taxpayer). I know. I was there.

            • Makroon

              Coal mining was “destroyed” by working an increasingly uncompetitive resource base (mostly deep, thin seams with lots of faulting).
              But London is the corporate centre of the global mining industry, and three of the biggest four companies, have a home here.
              Actually, one of our success stories.

      • Nicholas chuzzlewit

        You might like to run that one past Rolls Royce. They manufacture the best aero engines in the World and will be disappointed to learn that they have been destroyed.

        • telemachus

          you will find few other examples

          • Nicholas chuzzlewit

            BAE, Rolls Royce, GKN, Honda, Babcock, TATA, Nissan, Astra Zeneca, Tate and Lyle, GSK, Diageo. I would go on but you guys are not worth the additional effort.

      • HooksLaw

        Preposterous rubbish – it was under Thatcher that we attracted Nissan to Sunderland and Toyota to Derby and Honda to Swindon.
        Nissan now manufacture more cars in Sunderland than the whole of Italy.

      • CharlietheChump

        Thank god for Thatcher.
        Most of them were non-jobs, two or three men doing the work of one, just like in the NHS, civil service and other socialist make work schemes which continue to exist in la la land.

      • DWWolds

        1m jobs in manufacturing disappeared under Labour – more than under Margaret Thatcher.

        • telemachus

          Only because the Tories sowed the seeds

          • HooksLaw

            Hilarious. Lets remember 1945 when labour sowed the seeds of our post war decline.
            This is an easy game to play and you just lost.

            • telemachus

              Yes 1945
              When our victorious troops came home and put in a government that created the welfare state and our glorious NHS
              Then revitalised war torn industry to provide the wealth to pay for it

              • Andy

                ‘Glorious NHS’ ?? You mean the place stuffed to the doors with murderers in white coats ? I suggest you read the Frances Report.

    • HooksLaw

      The only problem with your assertion there is that thousands of public sector jobs have been cut and yet we still have more people in employment.

      Likewise the Spectator’s assertion that rising numbers in work are due to low wage rises seems dubious. Workers already in employment are having to limit pay rises but we still need to look at the fact that numbers in employment are rising. This is a harsh fact I know for socialists who pretend we are in recession but what kind of recession is it that sees increasing car output and registrations.

      The outlook is possibly not good but that is because of recession in the Eurozone which is beyond the governments control and seemingly beyond the ken of Mr Jones since he ignores it.

    • Chris lancashire

      Well I work in manufacturing and I haven’t felt frowned on. Equally, I don’t regard bankers, lawyers and venture capitalists as not having proper jobs – having worked with some very high quality people from these professions. And, whilst times are undoubtedly difficult, we have a thriving manufacturing industry in my region and some great national champions in GKN, Rolls Royce and JCB to name but three.
      Maybe things aren’t as bad as you think.

      • Daniel Maris

        Lawyers certainly suck the lifeblood out of an economy. Their legal comments and legal threats require other people to hire lawyers for advice and generate fear and loathing.

        • Chris lancashire

          Only in the disgraceful “claims industry”. In other areas they perform useful and valid functions, particularly M&A.

      • http://www.facebook.com/profile.php?id=100004981542519 Tom Tom

        JCB is finding life difficult…….

    • CharlietheChump

      We didn’t “frown” on manufacturing, we allowed unions to bargain for wages above global levels so we priced ourselves out of manufacturing jobs.
      The USA has used the benefits of shale gas energy to re-price itself into competitive markets, jobs returning in numbers from China etc.
      Meanwhile we debate if our shale reserves are “ethical”.

      • JMckechnie

        I think I agree with a great deal of what you say.

      • http://www.facebook.com/profile.php?id=100004981542519 Tom Tom

        German and Swiss wages are much higher than in the UK but Unit Labour Cost in the UK is higher because Productivity is lower. Productivity is a Management Issue

        • HooksLaw

          It depends if you believe the international statistics.
          We see in the UK hundreds of thousands of extra people in jobs but we are told GDP is falling.
          I do not believe that management is so inept.

          How does someone selling you a cup of coffee lead into ‘productivity’. Equally we know that Nissan in Sunderland run one of the most productive factories on the planet.

          Furthermore – statistics may give one figure for French productivity but only today I read of an American tyre (tire) company refusing to buy a French factory because they only worked ‘3 hours a day’

          • http://www.facebook.com/profile.php?id=100004981542519 Tom Tom

            Value-added per employee……it has to be assessed to levy VAT

        • Makroon

          No, productivity (as in ‘national productivity’), is a meaningless aggregate. If you compare sector, or better, company productivity you will find rather small differences. These aggregates just reflect changing economic structure.
          Nice to see Jonathan Jones sticking to his proprietor’s instructions – always speculate on bad news in reports of good news, and always a misleading headline.

      • Andy

        The Unions were, and are, infested with Marxists. They did not give a damn about their members jobs. All they were interested in was ‘the class struggle’ etc. It was often a waste of time even trying to reason with them, and I can understand why so many companies just gave in and paid up. By doing so they signed their own death warrants and it was this ‘blackmail’ which destroyed so much of manufacturing. I always find that those who have some rosy eyed view of manufacturing have never set foot in a factory in their lives. And before anyone starts to scream at me I would say I use to deal with these Marxist Union representatives and leaders.

    • DWWolds

      Yes, it is a great pity that jobs in manufacturing declined by 1m under Labour.

      • JMckechnie

        If I could just say that I am Conservative.

    • http://twitter.com/Shinsei1967 Nick Reid

      If that were the case overall earnings in the UK would be falling sharply. Which they aren’t, they are rising a little.

      I wish people would look at the actual data before espousing their ignorant prejudices.

      Yes, too many people are in part time jobs or low valued added jobs but this clearly isn’t the case across the economy as a whole.

      And our manufacturing capability has done just fine compared toother advanced mature economies. You seem stuck in a 1930s mindset.

      • JMckechnie

        I think it’s this country stuck in a 1930s mindset. The jobs in emerging manufacturing sectors is sadly lacking. The industrial revolution was possible because we had visionaries in the science and technology of that day. Do we have those industrialists today? Please tell me who they are.

    • Daniel Maris

      I agree. It’s like we gave up a steady job and decided to start dealing drugs.

      Our economy now is all about finance, funny money, mass immigration, population growth, part time and insecure work, the corrupt intern system, housing oligarchs from Russia and China, and more and bigger airports with more jobs that act as a magnet for mass immigration.

      We need to refocus on manufacturing, innovation, real jobs, housing for our citizens, and self-sufficiency.

      • Andy

        Glad you thinks so. What do you manufacture ?? How many people do you employ ?? Just curious.

      • Makroon

        You really need to get out more and explore your own country, you clearly don’t have a clue.

    • Andy

      And you manufacture what exactly ?????

  • HooksLaw
    • http://www.facebook.com/profile.php?id=100004981542519 Tom Tom

      Yet we still ask them to build nuclear power stations in Britain the country that had the world’s first civilian nuclear power station.

      • CharlietheChump

        Another Labour failure because they’ve never liked Nuclear since the days they were instructed to oppose it by Moscow.

  • http://www.facebook.com/profile.php?id=100004981542519 Tom Tom

    With 5% Poland’s population in the UK and Poles having a higher birthrate in the UK than in Poland there should be good economic news on the jobs front for the Polish Government too ! The best thing about Britain is that the more people work in marginal occupations the lower the tax revenue because Tax Credits work as Negative Income Tax – so the more low paid jobs we create the less Income Tax is collected

    • telemachus

      Further as noted above these jobs are demonstrably less and less productive and we are proportionately poorer year on year
      I fear we are going the way of Japan where it is demanded that red flag waving non productive workers are attached to all civil projects
      If you look at the third graph above the dotted line coupled with Kings confirmation yesterday of lack of growth tells you os a future of declining wealth
      The Balls call for build for growth is urgent

  • telemachus

    So with jobs rising and production at best flatlining we are clearly becoming less productive
    What is good news about that?

    • telemachus

      Other than it shows the coalition failing us economically therefore hastening the return to reasonable government

      • Reconstruct

        But does anyone really believe the GDP numbers? Yes, you can fiddle the employment numbers (though they are done in line with ILO standards), but at least you have a decent shot of getting it something like right. But GDP numbers? With a massively internationalized service economy, counting GDP is virtually impossible. As things stand, GDP estimates give journalists and politicians something to talk about, but otherwise aren’t taken very seriously right now.

        • HooksLaw

          Numbers are indeed a simple statistic, but the trend is surely a sound indicator.

          • http://www.facebook.com/profile.php?id=100004981542519 Tom Tom

            What Trend ? You clearly have no Statistical training if you think there is a Trend !

        • telemachus

          Do you feel richer?

          What is more this is the question we will be putting to the hapless electorate in 2015

          You Know the answer

          • HooksLaw

            Those residing on benefits will not feel richer, but they vote for their labour paymasters anyway if they vote at all.
            The not so hapless electorate will have to look at Miliband in 2015.

          • CharlietheChump

            I live in the South East and yes we are all richer here, it’s only in the socialist, big government dominated north that the left drags the country down.
            Just like in the ’30’s when there was no depression in London, massive house building and many Welsh left the valleys to work for Henry Ford in Slough.

            • telemachus

              As we all suspected
              This is the very worst kind of Home Counties Nicorevanchism.
              We heard none of this when the great northern industrial powerhouse of industry was making all you folk rich in the Victorian era

              • Colonel Mustard

                Careful now. I’ve warned you before about that Nico business. My legal team are standing by.

            • Daniel Maris

              Yes, there’s massive building in London now – for the Russian and Chinese oligarchs coming to live (occasionally) in London, their playground.

          • Reconstruct

            And it’s a good question. But the better question might be: ‘Do you feel more financially secure’. To which the answer for most people, having spent five years paying down debt, will be ‘ er. . . well, now you come to mention it.’

            Shall we put some figures to this? In the middle of 2008, the British private sector had net debts to the banking system of roughly £275bn. As of end-Dec 2012, they had net deposits in the banking system of £48.1bn. That’s a turnaround in financial position of around £325bn.

            So, according to Telemachus’ theory, the Labour Party is going to go into the 2015 election effectively asking: ‘ Do you want to be plunged back into debt?’

            It is quite surprising that Telemachus thinks the British electorate has learned nothing about the New Labour years. Because it’s been quite hard work regaining financial stability.

        • Chris lancashire

          Right again Reconstruct; hence the massive revisions to GDP figures by the ONS months after they are issued. That said, the trend should be reasonably reliable.

        • http://twitter.com/Shinsei1967 Nick Reid

          It’s an odd recession when car sales (a good canary in coalmine) in the UK are running at +11% YoY.

        • pilsden

          Try a read of Tim Morgan’s recent analysis he covers inflation stats as well as GDP

          http://www.tullettprebon.com/Documents/strategyinsights/TPSI_009_Perfect_Storm_009.pdf

      • http://www.facebook.com/profile.php?id=100004981542519 Tom Tom

        Talking to yourself Gollum ?

        • Nicholas chuzzlewit

          Yeah Ed Balls is his ‘Precious’

      • CharlietheChump

        You really are special as in Special Needs

        • telemachus

          The special need I have is the same as the need of the country
          We need a competent chancellor and an effective Government

          • Nicholas chuzzlewit

            Yes but an unworldly, sixth-form Marxist and and a dishonest economic illiterate who served as cabin boy and chief bar steward on HMS Catstrophe (Captain G Brown) hardly fit the bill.

            • telemachus

              I remember the true never had it so good that Gordon engineered before Lehman blew in

              • Andy

                Your dear Gordon the Moron Brown, who ought to be hanged, created a boom of mega proportions. That turned into a bust of mega, mega proportions. It will take well over 10 years, and probably approaching 20 years, to unwind the debt mountain that man created. As to the States finances I would hope to see them back in surplus by the end of the NEXT Parliament, but the accumulated debt that Brown is responsible for I will never live to see it repaid. The Labour Party should be liquidated.

    • HooksLaw

      How do you know production is flatlining? Car sales rising whereas elsewhere in Europe its falling. The notion that we are in a recession is risible.
      GDP – its a joke statistic.

      • Reconstruct

        One can get more specific. If you check the ‘hard data’ for industry – exports and output – you’ll find a really extraordinary month-on-month volatility surfaced in 2012 in the seasonally adjusted data. It’s a volatility quite unlike anything we’ve seen before, and looks very like a product of the seasonal adjustment process itself, rather than the underlying data. And the UK is not alone in this problem – Germany’s got it just as bad (and probably worse). Best guess is that we’ve going through a period of accelerated structural change, in which the (typically) seven-year patterning on which seasonal adjustments are made breaks up, and hence seasonally adjusted data gives all the wrong signals. I’ve written to the ONS about it, and they acknowledge there’s a problem.

        One would have thought it might have been a fit subject for a statistically half-aware journalist to run with, but I’ve seen nothing in the press about it.

        • telemachus

          May be volatile but linking the dots there is currently a downward trend
          The coalition are making us poorer

          • CharlietheChump

            Labour and the depredations of 60 years of socialist doctrine have made us poorer.

          • Reconstruct

            I know that you’re keener on cheap point-scoring than argument, but there is a serious point here: the GDP data itself is seasonally adjusted, and it’s clear that for whatever reason, the entrenched seasonal adjustment process is having real problems just now. Not just in Britain, but all over Europe. Actually, it’s not surprising – we’re living through a period of intense structural change, and seasonal adjustment methods rely on that not happening. So the chances are extremely high that eventually, when the statisticians understand and adjust for the changes, we’ll see hefty revisions to a lot of data, including most definitely the GDP data.

            So we’re left trying to join the dots. And in this process, the truth is it’s easier and therefore more reliable right now to count the number of people employed than seasonally adjusted GDP. Altogether, it seems very likely that there is a gradual but probably deep-seated recovery taking place under the bust statistical radar.

        • Chris lancashire

          I would add another possible cause and that is the volatility in oil and gas production. Particularly as production declines it appears to be very susceptible to closures of pipelines and pumping stations
          for maintenance.

          • telemachus

            No-one was saying that in 2007

        • CharlietheChump

          That’s because most journalists are statistically ignorant

      • http://www.facebook.com/profile.php?id=100004981542519 Tom Tom

        You are bonkers. We are not in a recession we are in DEPRESSION and will stay there for a very long time. You are so unbelievably dim that you must be a SpAd or in a psychiatric ward. 3.7 million people have lost their jobs in the UK since 2008 and over 100 million worldwide. Businesses are kept afloat by people pawning their watches and cars to get cash because Banks do not lend. Houses are for sale so small businesses can find capital. You clearly have no connection with the private sector whatsoever. You have the smug complacency of a public payroll junkie.

        • HooksLaw

          We are in a depression with rising car sales? Rising house prices? Rising employment?
          You are the one in the straight jacket.

          We have been left sinking in a sea of debt by labour. The economy cannot be run on debt and borrowing anymore – or bankers and their bonuses. We are being squeezed because of all the excesses in the past.

  • Daniel Maris

    These figures no longer mean what they purport to mean. So strictly speaking – they are meaningless.

    • http://www.facebook.com/profile.php?id=100004981542519 Tom Tom

      UK Government Statistics have been meaningless for years

    • HooksLaw

      ie they do not suit your prejudice.

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