It’s the same encouraging story on employment — only better

By Peter Hoskin
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The latest employment figures, published this morning, tell a similar story to those from last month and the month before that. Basically all of the major metrics are heading in a positive direction: the unemployment rate for the three months to August was 7.9 per cent, down from 8.1 per cent in the three months to May; there were 2.53 million people unemployed, down by 50,000; and the number of people claiming Jobseeker’s Allowance fell by 4,000 in September. As the graph above shows, this leaves us with 29.59 million people in employment — a rise of 212,000, and the highest figure since records began in 1971 (albeit with more people actually in the economy than back then).

Except today there’s a new good news story to tell. Youth unemployment has fallen below 1 million to its lowest total for over a year. It stood at 957,000 in the three months to August, down 62,000 on the previous period. Of course, youth unemployment of nearly 1 million is nothing to be complacent about — but the trends are encouraging, at least.

And so to that familiar question: how can the employment figures be so buoyant relative to economic growth? It’s still rather a mystery, although the answer probably lies in the compromises being made by some workers. At 1.7 per cent over the year, wage growth is still below inflation. And the number of people in part-time employment is still increasing, up by 125,000 in these latest figures to 8.13 million — some 59 per cent of the total increase in employment over the period. Crucially, this also includes around 1.4 million people who are working part-time because they couldn’t find a full-time job.

It is when these part-time workers start finding full-time work that we’ll know the economy is really picking up. But, in the meantime, these are welcome figures — and they’ll be as nectar to David Cameron, ahead of the Mitch-hunt to come at PMQs.