thenextwave

Gosh! Unemployment figures understate numbers

Posted in economics, trends, work by thenextwavefutures on 13 June, 2007

After several decades of finagling of unemployment figures, the news that there are still significant numbers of ‘hidden unemployed’ is a bit of a ‘dog bites man’ story, but Professor Steve Fothergill and his team at Sheffield Hallam University have done us a service by quantifying the numbers.

I haven’t been able to track down the original report, but there a news story in the Guardian along with some fetching graphics.

In a few lines:

  • They reckon that the “real” level of unemployment is running at 2.6m, three times the official count, and has been unchanged for the last five years
  • Official unemployment figures failed to count those diverted on to other benefits or out of the welfare system altogether
  • Of these, one million of the 2.7 million people on incapacity benefit – the major vehicle for disguising unemployment created through industrial closures during the 1980s – should be regarded as being in “hidden unemployment”
  • Hidden unemployment is particularly concentrated in the older industrial areas of the north, Scotland and Wales (where incapacity benefit was rife)
  • The estimated “real rate” of unemployment is well above 10% in Liverpool, Glasgow and Middlesbrough, and in several former coal-mining areas – in contrast there’s little hidden unemployment in the south east, at least outside of London.
  • But it’s not all bad news. The underlying unemployment level has fallen in those areas since Labour came to power – by something over 550,000.
  • But around 2m jobs have been created in this time. The difference is accounted for by women joining the workforce, people retiring later, and by migrants (who “are better able or more willing to fill the jobs that are available”, the report says. This may – my speculation – be because they are more able to move to areas where the jobs have been created, which aren’t overwhelmingly in the older industrial areas or former coal mining areas.)

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  1. […] July 20, 2009 · Leave a Comment “Real” level of unemployment is running at 2.6m, three times the official count… READ […]


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