Comment on the Labour Market Statistics Issued on 16 September 2009

LONDON - Commenting on today’s labour market statistics, Ian Brinkley, associate director at The Work Foundation, said:

“All the recent talk of recovery is clearly very distant from what’s happening in the labour market. If the experience of previous recessions repeats itself, it will be between 8 and 10 years for employment to recover to its previous level - it could be either 2016 or even 2018 before employment recovers fully. However, employers seem more reluctant to shed labour than in previous downturns - so employment may recover faster than in previous downturns.

“The employment figures using International Labour Organisation (ILO) definition shows nearly 220,000 jobs were lost comparing the three months to July with the previous three months. Many more people are losing their job than are signing on, which is rather different than in previous recessions. Losses have been concentrated among men holding full time jobs in the private sector. In contrast, part time jobs, self-employment and temporary jobs have been relatively unscathed. The figures also showed that young people under 24 continue to see disproportionately large job losses, but we are also seeing significant job losses in older workers as the labour market recession continues to spread and deepen.

“Manufacturing employment losses slowed in the quarter to June, but for the first time in the downturn we saw significant falls in total employment in construction. This heralds continued significant job losses to come as the big falls in construction output work their way through.

“In contrast, employment associated with the public sector grew - public administration, health and education services went up by over 40,000 on the quarter to June. These figures also include people who work in health and education services in the private and voluntary sectors. The ONS has also published separate figures on the public sector headcount. However, the total figure is misleading, as the ONS includes financial institutions such as Northern Rock, Bradford and Bingley, Royal Group of Scotland and Lloyds Group in the public sector total. So although the overall public sector total looks as if it has gone up since Autumn 2008, much of it is probably because of the inclusion of these bodies in the statistics.

“This makes perfect sense from a statistician’s point of view, as these bodies are now officially classified as public institutions. But it means that even more care will have to be taken with the public sector job statistics than in the past so we can distinguish between, say, changes in employment associated with reduced funding for public services and changes in employment caused by the temporary acquisition and subsequent sell-off of financial institutions by the public sector.”

Notes to editors:

1) Ian Brinkley is available for interviews.

2) The Work Foundation is the leading independent authority on work and its future. It aims to improve the quality of working life and the effectiveness of organisations by equipping leaders, policymakers and opinion-formers with evidence, advice, new thinking and networks.

Source: The Work Foundation

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