Today’s statistics on the labour market offer George Osborne some respite from the criticism he has been under recently. In the three months to May 2012 employment was up, hours worked up and unemployment down. And crucially this was driven by full time employment, rather than increases in part time employment that have been seen in the past.
What this means for economic growth is unclear. The increase in hours worked over the last year (around 30 million extra per week) suggest that demand in the economy has picked up, and yet this hasn’t been reflected in the GDP figures. While the labour market figures have been positive for several months now, ultimately it is the GDP figures that really count for the Government. Given the recent troubles that the Government has had, extra emphasis will be put on the release of economic growth figures for April to June next Wednesday. Expect more political fireworks.
Of course, these fireworks sometimes seem to distract from the real impact that these figures have on people’s lives. And as ever, the national figures hide the variation in performance across our cities.
Hull continues to have the highest claimant count rate of all cities at 8.2 percent, while at 1.8 percent Cambridge has the lowest. And since the beginning of the recession six of the top ten cities for increases in youth claimants are in Yorkshire and the Humber. So while arguments will continue to rumble about national growth within Westminster, focus should not be lost on the uneven impact that the downturn is having.