What’s happening on the jobs front – part one

Against the odds, and despite lacking direct access to all the economic levers, the SNP government has managed to keep Scotland working.  Since 2010, their stewardship has resulted in more people finding work and fewer people losing jobs.  In the year to July, 55,000 more people have found jobs.  At the same time, the unemployment rate fell below that of the UK as a whole.  Moreover, fewer people are economically inactive – that is, not in work, education or training.  That rate fell by 35,000 in the last year.  These are remarkable achievements and deserving of plaudits.

But beneath the headlines is a much more mixed picture.

First, there is a gender divide on the jobs front.  While male unemployment is still marginally higher in Scotland than in the UK as a whole, it is falling – by some 19,000 over the last year.  And while female unemployment in Scotland is also lower than that for the UK, over the last year, more women have lost their jobs.  There are now 4,000 more women out of work than this time last year.

Second, the claimant count – which is measured differently from the jobless rate – is rising, albeit more slowly than for the UK.  At the end of June, 139,615 people were claiming Jobseekers’ Allowance, a rise of 6,380 in twelve months and a rise of 11,595 compared to 2009.  And again, the number of women claiming JSA is rising while the number of men claiming the benefit is falling.  According to the statisticians, the reasons behind this are complex, possibly due to a “correction in unemployment (particularly among men) following weak labour market performance in 2010; and women being affected by reductions in public sector employment”.  Most worryingly, the claimant count rate is expected to rise still further in the next two years, mainly due to welfare reform.

Third, we are starting to see falls in the number of people employed in the public sector.  In the first quarter of 2011 (April to June), public sector employment fell to just under 25% of total employment.  It is still higher than in 1999 when it represented 23.8% but this is partly explained by bank employees bailed out by the taxpayer now counting as public sector workers.  The biggest fall has been experienced in devolved public sector jobs and particularly in local government, with 9,800 fewer people employed by councils compared to the first quarter of 2010.

Meanwhile, the number of people employed in reserved public sector positions has actually increased.  While the numbers in civil service jobs have fallen, those employed by public sector financial institutions – that’s Royal Bank of Scotland, Northern Rock and Lloyds HBOS to you and me – has gone up by 3,600 or 9.9%.  Who knew?

Finally, there is an alarming increase in the numbers of long term unemployed.  There are 23,000 more people unemployed than there were two years ago.  And if we look at the claimant count, 20,640 have been in receipt of JSA for a year or more.  This represents a drop of 2.1% compared to the same period to 2010 but it is a whacking 88.5% increase over the last two years.  While the rate of long term unemployment has fallen in 18 out of 32 local authority areas, it has risen in the remaining 14, emphasising the growing divide across Scotland’s communities between those in work and those not.  However, some of those are surprising:  Aberdeen has recorded an increase in long term unemployed of 126%, East Lothian an increase of 233%, East Renfrewshire of 210%, Edinburgh 126%, Perth and Kinross 278% and Scottish Borders has experienced a 200% rise in people being out of work for two years or more.

Dig beneath the headlines and you uncover much less good news on the unemployment front.  While more jobs are being created, they are likely to be filled by men rather than women.  And if you are out of work for more than a year, it seems to become harder to find a job.  Meanwhile, job losses in the public sector, and particularly in local authorities, are beginning to bite.  But aren’t you glad that your hard earned taxes are going to keep more bankers in work than at the height of the recession?  Does our largesse know no bounds?

The SNP would – with some justification – argue that Scotland needs its hands on all the economic levers to sort our economy properly.  At the moment, they can only do so much to create the right environments for jobs.  But how far has its economic strategy been finessed to ensure the long term unemployed, economically inactive and women can all return to or stay in work?

For an answer of sorts, look out for part two of this analysis, which will be posted tomorrow, over at Better Nation.  Bet you can’t wait…

All data and quotes are taken from the Scottish Government’s Labour Market Monthly Briefing for July 2011



11 thoughts on “What’s happening on the jobs front – part one

  1. Are you absolutely sure that all these women are losing their jobs? Yes, the increase in the number of women claiming Jobseeker’s Allowance is beyond dispute but did all these women come from the labour market in the first place?

    The last Labour government had the wizard weeze of removing entitlement to Income Support to thousands of lone parents without first ensuring there were jobs for these claimants to take up. Deprived of their normal income, these lone parents had no choice but to claim Jobseeker’s Allowance. Since most lone parents are female, doesn’t that explain the dramatic increase in the female unemployment count in comparison to the male count?

    Of course, trying to point this out to the likes of Ann McKechin over on Labour’shame when she made similar points to yourself (and tried to blame Salmond for it) only resulted in my post being moderated (old Tom isn’t too keen on inconvenient truths).

    • The test would be to look at the level of women’s employment before and now – will go hunt down the figs.

      I’m a bit rusty on the welfare changes but the shift off of IS was on to Employment and Support Allowance – I think you can only get JSA if you have been in work and then become unemployed, and then only for a limited time.

      SNP Government not to blame but if rise is because of public sector job losses – as the Scottish Government brief suggests – then it is a public policy issue. Also, women concentrated in lower paying public sector jobs, and certain professions like teaching and nursing. So if more women losing jobs from public sector, that also tells us where job losses are coming from.

      • The conditions of entitlement to JSA don’t require that you have ever worked. Under the scheme “Lone Parent Obligations”, lone parents in receipt of Income Support were required to actively seek employment and claim JSA when their youngest child reached 7 (this was originally 16, then 12, then 10). There were plans to reduce this to 5 (i.e. starting school age) but whether this will be implemented remains to be seen.

        The move from Income Support/Incapacity Benefit to ESA is an entirely different scheme.

      • Thanks for clarifying. Maybe it has had an effect then…. another legacy of New Labour.

  2. Pingback: What’s happening on the jobs front – part two « Better Nation

  3. Very interesting to see these stats broken down.

    What I think is really interesting to see is the pattern of part time work or short term contracts. It is my perception that both these things have increased significantly as perm jobs are replaced by part time or short term work. I think this is a very important part of the story.

    Fascinated to see that banks count as public sector – therefore surprised to see that the percentage of those working in the public sector isn’t even higher!

    Don’t knock people working for banks. Banks are huge and not everyone employed by them is a banker – they are a really important source of ordinary jobs for all sorts of ordinary Scots.

    This massive recession has had an ebb and flow – first the private sector took a battering and now the public sector is about to take a hit – this has consequences for the relative employment flows of men and women over time if you are analysing unemployment by gender.

    I see some dark clouds on the horizon – public sector cutbacks is one. The retrenchment of financial services is another – despite the increase in employment numbers I think more job losses may be about to work their way through the system of Scotland’s banks and insurance companies in the next couple of years.

    Finally the statement that the SNP administration has managed to keep Scotland working. My interest is one of causation. What has the Holyrood administration been able to do that has had any material affect on these numbers?

    Understanding unemployment patterns is important to see in a whole of the UK context to see the pattern across all the regions and nations of the UK. Would be interesting to see some of this in that context as there is often a ripple effect from SE England and Midlands out to the north and to the west in terms of the unemployment numbers.

    • See my response re impact of banks. The reason they are now considered public sector is because of the huge bail-outs. That is enabling them to continue to grow and recruit staff but now at the cost of the public sector which is having to cut jobs in order to rein in expenditure. caused by the bail-out. It’s not about knocking the banks but about realising the consequences of them being too big to fail.

      Apprenticeships, capital investment, low business rates for small businesses, the use of RSA and other grants, no compulsory redundancies, building council housing and housing association stock are all keeping folk in work. They can only dabble around the margins but on the face of it, what they have done has had an impact.

      The link takes you to the full briefing which shows regional and country variations across the UK. Scotland doing better than middling I think compared to other regions on unemployment and claimant count. Not better than the rest but certainly not the worst. As usual South East England managing to power away without everyone else.

      • I’m going to go a bit glass-half-empty here and note that the spending cuts are delayed a year here compared to England so it’s possible we’re just seeing the effect of that, with a sharper fall to come as we have to implement the same spending reductions in less time.

    • Thanks for the reply.

      I’ll look forward to more tomorrow.

      BTW – I am interested in seeing more about the growth of part time and short term contracts with no benefits as I think these ‘poorer’ quality jobs have replaced many ‘better’ ones and this underemployment is a hugely important part of this question.

      From memory Scotland often does better than NI, SW England and the North East of Eng and about the same as North West England.

      London, the SE and West Midlands often power away – though there is something in those parts of UK helping to drive economy as a whole and prosperity growing as a ripple.

  4. But…….In Scotland there is always a but.Glass is permanently half empty.

    • Are you suggesting it doesn’t matter what is going underneath the headlines so long as the headline figs are good? So if more people are out of work long term that doesn’t matter? That we shouldn’t have a view at the fact that the bank bail out means they can carry on as before, and indeed, even continue to hire people, while the public sector has to cut jobs in order to pay for that? And that fewer women being in employment – with the knock on effect to children, as evidence shows that children are always impacted adversely if women do not work – is of no consequence?

      Your glass will be half full then!

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