The Tories are very keen to sabotage Ed Miliband’s big speech about rebalancing the British economy, which is probably a compliment to the Labour leader as it suggests that they think he might be onto something. Both parties are certainly engaged in a localism arms race at the moment, arguing that they’re the party that really trusts voters and wants to give them back the power over their own lives.
But Miliband appears to have made a bit of a statistical error which is allowing his opponents to create a bit of a sideshow to distract from the launch of Lord Adonis’ final report on growth. In his speech, the Labour leader said ‘independent experts say four fifths of all new private sector jobs created since 2010 are in London’. Matt Hancock has already sent a cross letter to the UK Statistics Authority complaining about this stat, and he’s now written to Miliband directly. Coffee House has seen the letter first and you can read it in full below. It says Miliband got his data from an out-of-date report, and that the most recent Office for National Statistics figures suggest London accounts for less than 1 in 4 net additional private sector jobs created. Hancock tells Miliband that ‘I know that you would not want to inadvertently mislead the British public into believing that the employment situation is worse than it actually is’, and demands a ‘full and public correction’:
‘Indeed since you appear to have put this erroneous statistic at the heart of your new policy launch, I believe that it would be only proper for you to issue a full and public correction, and in doing so, accept that our long-term economic plan is helping to create jobs across Britain.’
These cross letters are an amusing part of Westminster life. But aside from a dodgy data moment, both parties do recognise that parts of the country don’t feel quite so rosy as London and the South East, which is why George Osborne was talking about directly-elected regional mayors and a third high-speed rail link just last week.
I notice that today you have claimed that ‘four fifths of all the new private sector jobs created since 2010 are in London’.
This is factually inaccurate.
The statistic you make reference to is from an out of date Centre for Cities report which only looked at the regional labour market between 2010 and 2012.
The most recent, unadjusted ONS statistics for the last four years (Q1 2010 to Q1 2014) suggest that London has accounted for less than 1 in 4 net additional private sector jobs created (21.7%). Using the most recent available data which is adjusted for reclassifications but not seasonally adjusted (between Q1 2010 and Q2 2013), London again accounted for around 1 in 4 net additional private sector jobs (24.3%). Using data adjusted for reclassifications, and which is comparable on an annual basis (between Q1 2010 and Q1 2013), London still accounted for around 1 in 4 net additional jobs (27%).
I know that you would not want to inadvertently mislead the British public into believing that the employment situation is worse than it actually is.
Indeed since you appear to have put this erroneous statistic at the heart of your new policy launch, I believe that it would be only proper for you to issue a full and public correction, and in doing so, accept that our long-term economic plan is helping to create jobs across Britain.
Matthew Hancock MP
P.S. The four-fifths claim in Adonis’s report was a repeat of one from the Centre for Cities’ Cities Outlook 2014. It says that ‘since 2010, 79 per cent of private sector jobs growth has occurred in London’, and was based on a survey of businesses – but the data only runs up to 2012. Here’s a statement from the Centre for Cities’ CEO, Alexandra Jones:-
The Centre for Cities’ annual Cities Outlook report for 2014 showed that 80 per cent of all private sector jobs created between 2010 and 2012 were created in London. This figure is based on data from the Business Register and Employment Survey (BRES) from the Office for National Statistics (ONS), which looks at employment by workplace. By contrast, the figures being quoted by the Government – which argues that 80 per cent of private sector jobs over the last year were created outside of London – are either based on the Annual Population Survey (APS) or the Labour Force Survey (LFS) data, which are both regional and measure employment by place of residence. This dramatically undercounts the number of people who work in London but live elsewhere.
While no dataset is perfect, BRES data gives a more accurate picture of where jobs are located, rather than where employed people live. Using APS or LFS data, a working person who lives in St Albans would be classed as employed in their home town of St Albans, even if their job was actually in London. The BRES data is updated annually, and the data for 2013 has not yet been released, while the APS and LFS datasets are released quarterly. However, in order to measure where people work rather than live, it remains the most consistent and accurate source of UK employment data currently available.
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