Alan Johnson MP

11 November 2009

Labour is determined not to repeat the Tory policies of the past which left families and communities scarred for generations. That is why Labour is investing £5 billion now to help people get back to work - £5 billion which the Tories oppose.

If we don’t act now, it will cost us all more in the long term. Labour’s choice is to invest billions in people’s future now. The Tories oppose giving people this extra help and would cut back on the support available to people during the downturn. Unlike the Tories we do not believe that unemployment is ever “a price worth paying.”

Independent experts recognise the disaster the Tories would cause. According to Professor David Blanchflower (former member of the Monetary Policy Committee of the Bank of England), George Osborne’s plans would lead to unemployment reaching 5 million.

Contrary to the claims in Cameron’s speech last night, yesterday the Conservatives voted against greater responsibilities in the benefit system that will help parents into work, and help cut child poverty. They also want to abolish the New Deal for Lone Parents. The reality is they don’t support more responsibilities because they won’t support the extra rights to support that come too. The Tories aren’t serious about cutting poverty or welfare reform.

Today’s figures show that many in the UK are suffering the effects of the recession.  But there are signs that our actions to help the unemployed are starting to work. 

Labour’s active welfare state is working. In stark contrast to previous recessions, people aren’t being dumped on inactive benefits like incapacity benefit, and Government action has helped to protect up to 500,000 jobs during this recession. 

Background to Labour Market Statistics

This month’s Labour Force Survey covers July 2009 to September 2009.  The claimant count and Jobcentre Plus vacancy count dates were 8^th and 2^nd October respectively.

The number of people in work rose this quarter

• nearly 29 million people were in work in July to September.
• employment level in July-September was 6 thousand higher than the previous quarter and 490 thousand lower than in the same quarter last year.
• the employment rate is 72.5%, down 0.1 percentage points on the quarter and down 1.9 percentage points on the year

The number of people claiming JSA has risen this month

• claimant unemployment was 1,639.5 thousand in October 2009, up 12.9 thousand on the level in September, and up 632.7 thousand on the year. 
• the claimant unemployment rate, at 5.1%, is virtually unchanged on the month and up 1.9 percentage points on the year.
• inflows to JSA were 361.4 thousand in October, up 4.0 thousand on the month and up 80.8 thousand on the year. The number of people leaving JSA increased to 333.9 thousand, down 1.3 thousand on the month and up 104.5 thousand on the year.
• In the year to May 2009, the number of people claiming employment support allowance/incapacity benefits rose by 25,600 to 2.6 million.  More recent provisional estimates suggest that there were 2.63 million claimants in September 2009, unchanged on the month but up slightly from the level a few months ago.

ILO unemployment has risen this quarter

• 2.46 million people were ILO unemployed in the July to September quarter, up by 30 thousand on the April to June period and up 629 thousand on the same quarter last year. 
• the ILO unemployment rate is 7.8%, up 0.1 percentage points on the quarter and up 2.0 percentage points on the year.

·        International ILO unemployment: ILO unemployment (7.8%) is below EU average and below that of US, Canada, France and Spain

The number of 18-24 year olds who are unemployed has increased

·         746 thousand 18-24 year olds were ILO unemployed in the July to September quarter, this is up by 24 thousand on the April to June period and up 165 thousand on the same quarter last year.

·         Of the 943 thousand unemployed under 25 year olds, 267 thousand are in full time education.

The level of economic inactivity is up on the quarter and up on the year

• the economic inactivity rate is 21.1%, up 0.1 percentage points on the quarter and up 0.2 percentage points on the year.
• excluding students, inactivity as a proportion of the working age population is unchanged at 15.3% on the quarter but down 0.2 percentage points over the last year.

There are still many vacancies available, and the number of redundancies has fallen back this quarter:

• There were 205 thousand redundancies in June to August, down 63 thousand on the previous quarter and up 49 thousand on the previous year.
• ONS’s vacancy survey estimates an average of 428 thousand unfilled vacancies in the three months to October 2009, down a thousand on the quarter and down 154 thousand on the year.
• In the last month Jobcentre Plus has taken on average over 10,000 new vacancies every working day and many more come up through other recruitment channels.

Labour’s help for people when they need it most

·        As unemployment has increased, Labour has stepped up the support for people losing their jobs - £5bn of extra investment.

·        The Tories oppose this help because they oppose spending any more money to help people through the downturn. Real help costs real money.

Before redundancies happen

We give help to people at risk of redundancy to find a new job, even before they become unemployed through our Rapid Response Service (RRS). Opposed by the Tories.

Day One of Unemployment

We have invested to guarantee that everyone looking for work will get, from day one: help and advice on finding a new job, help to write a new CV and fill in job applications; help on retraining and skills advice; help with their rent and with their mortgage from 13 weeks; help to access to the new vacancies recorded by Jobcentre Plus every working day. We are recruiting thousands of new Jobcentre Plus staff to help people into work. Opposed by the Tories.

From 3 Months Unemployed:

People will get extra help with mortgage payments (SMI) to help them keep their homes when they lose their job. We are giving twice as much help, paid earlier. In addition, we step up the help we give with wider job search and more intensive support from advisers. Opposed by the Tories.

From 6 months unemployed:

We know that the majority of people move off Jobseekers Allowance within 6 months, but we are guaranteeing more help for those that don’t. We are promising every jobseeker more support if they have not managed to find a new job within six months.  As well as extra funds for Jobcentre Plus to allow them to provide more intensive and personalised support, we are offering:

·        “Employers’ Golden Hellos”: incentives of up to £2500 (£1000 in Scotland and Wales) paid to employers to recruit and train unemployed people

·        New training places: extra funding for training places to help unemployed people get new skills to maximise their chances of getting jobs from the 500,000 vacancies in the economy.

·        Work-focused volunteering options: opportunities to volunteer to help people back into work habits

·        Help to set up a business – advice on creating a business plan, plus funding for the first months of trading.

Backing Young Britain

The joint campaign with business, public sector bodies and charities runs over the next few months.  It recognises that times are tough – but calls on everyone to play their part. We want to give young people leaving school or university a chance and to harness the talent of the future for Britain’s organisations.  This will help young people get into the jobs market – and benefit business into the bargain.

We are calling on employers, on businesses and other organisations to make a commitment to support young people in at least one of the following ways:

• work with a partnership to bid for one of the 100,000 jobs for young people from the Future Jobs Fund
• offer a volunteering place or a volunteer mentor for school or university leavers;
• provide work experience places to help young people learn about work, make contacts and fill their CV
• consider a young person for a job through a work trial
• offer an internship for a graduate
• provide an apprenticeship for 16-24 year olds
• join a Local Employment Partnership to make sure job vacancies are advertised to local unemployed people

 Labour’s Guarantee for young people:

·        Labour will protect Britain’s young people from the effects of the global recession by offering work or training for every 18 to 24 year old who is in danger of becoming long term unemployed.

·        We are funding 250,000 jobs in the public and private sectors, including a ‘Future Jobs Fund’ that will enable local authorities and third sector groups to develop innovative ideas for jobs that will make Britain a better place.

·        The Future Jobs Fund will provide 150,000 new jobs, at least at a National Minimum Wage level, around two thirds of which will be directed at young people. The remaining jobs will be focussed at areas of particularly high unemployment.

·        The Fund is already open for business and we are working with councils and voluntary groups on developing new jobs through the fund and, by January next year, every 18 to 24 year old who is approaching 12 months unemployment or more will be guaranteed a new job, training or paid work experience place.

·        We are calling on every local authority, voluntary sector and social enterprise to bring forward their ideas of jobs they could offer - we want organisations to come to us with proposals and we hope that bidders can match funds, alongside the £6,700 we will provide.

·        In addition to the Future Jobs Fund we will offer 100,000 jobs opportunities in the sectors of the future that will help Britain grow.

·        Despite the recession, many sectors still have vacancies and others will grow over the coming years. In these areas we will set aside posts for young job seekers and offer them pre-employment training and a recruitment subsidy, so talented young people can take up interesting jobs and gain vital work experience for jobs of the future.