Archive for the ‘Economy’ Category

Labour market statistics: Unemployment up, inactivity down

The key points from this release are:

  • The employment rate for those aged from 16 to 64 was 70.3 per cent, up 0.1 on the quarter. There were 29.13 million people in employment aged 16 and over, up 60,000 on the quarter. The unemployment rate was 8.4 per cent of the economically active population, up 0.1 on the quarter. There were 2.67 million unemployed people, up 48,000 on the quarter. The unemployment rate has not been higher since 1995. The inactivity rate for those aged from 16 to 64 was 23.1 per cent, down 0.2 on the quarter. There were 9.29 million economically inactive people aged from 16 to 64, down 78,000 on the quarter.
  • Total pay (including bonuses) rose by 2.0 per cent on a year earlier, unchanged on the three months to November 2011. Regular pay (excluding bonuses) rose by 2.0 per cent on a year earlier, up 0.1 on the three months to November 2011.

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Unlocking Liverpool: The Deal!

On 8 December 2011 the Government launched ‘Unlocking Growth in Cities’, which set out the terms for a programme of city deals

The Government has now considered the proposals brought forward by Liverpool for a ‘City Deal’ in response to this challenge. The Government recognises it represents an ambitious economic package aimed at driving growth in Liverpool, and that it is an important part of the City’s response to Lord Heseltine and Sir Terry Leahy’s “Rebalancing Britain” report on the Liverpool economy.

The Rt Hon Greg Clark MP has informed the House that the Government has approved the following proposals from Liverpool as a ‘City Deal’:

  • Subject to HM Treasury clearance of a business case and agreement with the Local Enterprise Partnership, the Government will designate a new Enterprise Zone covering the City Fringe Buffer Zone and Central Business District.
  • The creation of what Liverpool propose to term a Mayoral Investment Board that will oversee the city’s economic and housing strategy as well as oversight of the development of Home and Communities Agency’s land assets and other economic development priorities including those linked to the Enterprise and proposed Mayoral Development Zones.
  • The Department for Work and Pensions will work with Liverpool to develop welfare pilots to deliver a localised programme of support for people leaving the Work Programme and in particular include a ‘youth contract’ pathfinder.
  • A Secondary School Investment Plan funded by the Council for up to twelve new build secondary schools, including at least six new academies.
  • The Department for Communities and Local Government will contribute £75 million over the remaining years of the spending review period, subject to a strong, robust business case, to be cleared by HM Treasury, demonstrating clear value for money.
  • The Government set out in ‘Unlocking Growth in Cities’, that where cities want to take on significant new powers and funding streams, they will need to demonstrate strong, accountable leadership, an ambitious agenda for the economic future of their area, effective decision-making structures, and private sector involvement and leadership. The Government can confirm that a move towards a directly elected mayor and the creation of a Mayoral Development Corporation would satisfy its requirements as regards governance arrangements to strengthen leadership and accountability in Liverpool City Council.

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Household benefits cap defeated in the Lords

The Welfare Reform Bill has completed its Commons stages and is now in the penultimate stage in the House of Lords. Ministers have already said a defeat in the Lords will be overturned in the Commons, but it seems that the bill will be subject to a ping-pong effect until an agreement is reached.

Most recently, the government has been defeated in the Lords in a vote on its plans for a £26,000-a-year household benefit cap.

This was an amendment that child benefits should not be included in the cap, and this was backed by 252 to 237 peers.

The government argued that the benefit cap will save £290m next year, with 67,000 families losing on average £83 a week.

Benefit cap proposals:

  • From April 2013, the total amount of benefit that working-age people can receive will be capped so households on out-of-work benefits will not receive more than the average household weekly wage.
  • this applies to combined income from the main out-of-work benefits – Jobseeker’s Allowance, Income Support, and Employment Support Allowance – and other benefits such as Housing Benefit, Child Benefit and Child Tax Credit, Industrial Injuries Disablement Benefit
  • Exemptions for households in receipt of Working Tax Credit, Disability Living Allowance or its successor Personal Independence Payment, Constant Attendance Allowance and war widows and widowers.
  • Forecast to save £290m in 2013-14 and £330m in 2014-15.

Read more on the current progress of the Welfare Reform Bill in the House of Lords.

Amanda Frewin

Research & Project Support


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Unemployment up by 118,000 but JSA claimant less than expected.

The Office for National Statistics has published the latest employment figures showing 2.69 million people were ILO unemployed in the September to November quarter, up by 118,000 on the June to August period


Inactivity fell by 61,000 on the quarter and the rate fell 0.2 percentage points to 23.1%. Meanwhile, the number claiming Jobseeker’s Allowance rose by 1,200 in December 2011 to 1.6 million. This is, however, less than the 10,000 expected.


Today’s figures show a fall in youth unemployment reflecting the numbers in full-time education. Full-time students now account for 30% of all those unemployed between the ages of 16 and 24. The number of 16 to 24-year-olds who have left full-time education and are seeking work is 729,000. The number of full-time students looking for a job rose 44,000 to 313,000.

Employment Minister Chris Grayling has responded to these latest figures:

“The overall level of unemployment is, and will remain, a major concern for the Government. The latest figures reflect the current challenging economic climate but also show more women entering the workforce and more students looking to supplement their income through work. When you take into account our welfare reforms the number of Jobseeker Allowance claimants has actually fallen.

“Despite the exceptionally difficult economic circumstances, finding work for the unemployed will remain top of the Government’s agenda.”

Click here for the latest Labour Market Statistical Bulletin

Amanda Frewin

Research & Project Support

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Youth Contract: War of words between Scotland and Westminster

Deputy Prime Minister Nick Clegg has urged First Minister Alex Salmond to join forces with the UK Government to tackle youth unemployment.

Mr Clegg was in Scotland promoting the UK Government’s £1 billion Youth Contract. Mr Clegg explained that the SNP administration had initially dismissed the Youth Contract which gets under way in April and which aims to find at least 410,000 work places for 18 to 24-year-olds across the UK, with wage subsidies worth £2,275 handed to employers to take on 160,000 young people.

The initiative will also create additional work experience places while £50 million will be spent on helping 16 and 17-year olds into training. The Government says the programme will see £100 million of benefit to Scotland, £18 million of which will go to the Scottish Government over three years.

A spokesman for the First Minister said: “The Deputy Prime Minister is entirely wrong – as the First Minister has made clear on several occasions, the Scottish Government is fully committed to working with Westminster to tackle youth unemployment in Scotland.

“… youth employment is higher in Scotland than the rest of the UK – 61.9% compared to 57.8% – and a third of unemployed young Scots are also in full-time education ….

“We announced the appointment of Scotland’s first dedicated Minister for Youth Employment last year [this is the only such government position in any of the UK administrations] backed up with £30 million of new resources.”


Its interesting that our politicians have time to politick argue the toss whilst Rome burns… what people want to see is change and real action not this incessant navel gazing, positioning and ‘one-up-manship’. The city doth burn….

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New ONS unemployment figures released

The Office for National Statistics have published unemployment figures which show unemployment to be at 2.638 million compared to the previously published figure of 2.622 million. However, the number of people in work is 38,000 higher than the level published last month.

Latest figures also show a more stable picture on youth unemployment.  The number of 16 to 24-year-olds who have left full-time education and are seeking work is 730,000, the same as the figure published last month, while the number of full-time students looking for a job has risen to 297,000.

The figures show that in the past 18 months the number of people claiming one of the main out-of-work benefits has fallen by around 40,000 and over the same period the number employed by the private sector has risen by over 500,000.

Employment Minister Chris Grayling said:

“There has obviously been an unwelcome increase in unemployment since the summer but these latest figures show some signs that the labour market is stabilising. The number of people in employment is higher than last month’s published figure and the number of unemployed people is steadying.  Encouragingly this is also the case for young people not in education.

“The increase in those claiming Jobseeker’s Allowance has slowed and our welfare reforms are having a positive impact with overall benefit claimant numbers falling by around 40,000 in the last 18 months.”

There are still economic challenges ahead and the government is reacting by helping people to find employment through initiatives with the private sector.

It was announced in the past month that 160,000 incentives of £2,275 will be available to employers who take on young people in the Work Programme. This is more than enough to cover an employer’s National Insurance contributions for a year and exceeds the recommendations by the CBI in their recent report on youth employment.

The £1billion programme to help young unemployed people also pledged 250,000 extra Work Experience places over the next three years, taking the total to at least 100,000 places a year. The private sector has been vital in the success of this scheme with half of under-25 year-olds taking part leaving benefits within three months.

To support private sector growth the New Enterprise Allowance will help people to become self employed and in turn become employers themselves. The initiative provides a business mentor and offers financial support of up to around £2,000, including a weekly allowance for up to 26 weeks and access to a start up loan. 40,000 new businesses are expected to be created by 2013.


ONS Statistical bulletin


Amanda Frewin

Research & Project Support


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Unlocking Growth cities

England’s largest cities are being offered a menu of transformative new powers which the government wants to explore as the basis of a series of bespoke ‘City Deals’. The Deputy Prime Minister announced the City Deals in Leeds on 8 December 2011.

The Government will work with different cities over the coming months and years to agree a series of tailored ‘city deals’. Read more

Unlocking Growth in cities

Whats happened so far…

Nick Clegg explained that;

  • We have already taken some important steps to help cities drive forward growth:
  • creating Local Enterprise Partnerships to bring together civic and private sector leaders to drive growth;
  • putting greater financial powers in the hands of local authorities through business rate retention and new borrowing powers;
  • creating 24 Enterprise Zones with the power to use Tax Increment Financing;
  • providing a new £100 million urban broadband fund, which will create up to 10 ‘superconnected cities’; and
  • investing £744 million in urban areas through the Regional Growth Fund, with a further £1 billion for the Regional Growth Fund

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