High and rising unemployment is a matter of serious concern in the UK, particularly in light of the headline unemployment rate hitting a 17-year high of 8.4%, according to last month’s unemployment data release from the Office for National Statistics (ONS).
Economic commentators are united in expecting unemployment to continue to rise. Latest unemployment forecasts include the following:
- The British Chambers of Commerce (BCC) expects the unemployment level to hit 2.9 million (equivalent to 9% of the workforce) in Q1 2013. The BCC believes young workers will be hardest hit. It expects to see a 41% jobless rate for 16 and 17 year olds by Q1 2013, while the 23% of 18 to 24 year olds will be out of work by Q4 2012.
- The Institute for Public Policy Research (IPPR) predicts that unemployment will not peak until September 2012 at the earliest, with a further 100,000 people becoming unemployed over the remainder of the year, primarily as a result of job cuts in the public sector. An IPPR spokesperson comments: “This has been the longest recession and the slowest recovery that Britain has ever experienced. The risk is that high unemployment becomes a permanent feature of the UK economy, as it did in the 1980s.”
- The Office for Budget Responsibility (OBR) expects unemployment to peak this year. XpertHR summarises its latest unemployment forecasts: “Unemployment will peak in 2012 – both on the ILO measure (8.7% unemployment in 2012) and the claimant count (1.67 million unemployed). The OBR says that one million more jobs will be created over the next five years. Consumer prices index inflation is forecast to average 2.8% in 2012 but to fall to 1.9% in 2013.”
- XpertHR economic commentary April 2012: Not out of the woods yet XpertHR’s April 2012 economic commentary looks at the risk of double-dip recession, trends in unemployment, and predictions for private sector pay awards.