Jobless numbers in record fall as private sector shows signs of growth

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The Independent Online

The number of people out of work has fallen by the largest amount in over a decade, official statistics have shown. The figures reveal unemployment fell by 82,000 in the three months to October to 2.51 million – down 128,000 on a year ago.

This represents the biggest quarterly fall since the spring of 2001. Employment also rose by 40,000 to 29.6 million, up by half a million on a year ago. However, other data released by the Office for National Statistics complicated the picture, pointing to rising unemployment over the past two months and showing the strong increases in employment seen since the summer are now petering out.

On the first set of figures, private sector employment rose by 65,000 to 23.8 million. This offset the 12th consecutive quarterly fall in public sector employment, which declined by 24,000 to 5.7 million, the lowest since 2002. Employment in the civil service was cut by 3,000 to 455,000, while local government employment also fell to a record low of 2.5 million after a cut of 32,000.

The Employment minister Mark Hoban welcomed the news, saying: "These figures show the private sector is creating far more jobs than are being lost in the public sector. It's a credit to British businesses."

Yet a separate labour market survey by the ONS, which reports on monthly rather than quarterly movements, told a different story. It suggested that employment fell by 11,000 to 28.5 million in October. Meanwhile, the number of unemployed rose by 112,000 over the month to 2.57 million. According to this series, the unemployment rate has crept up over the past three months to 8.2 per cent, rather than falling to 7.8 per cent as the main ONS release suggested.

The ONS's monthly series is not classified as official national statistics because it draws from a smaller sample of respondents than the main quarterly survey and is deemed more volatile. But some economists feel the image presented by the monthly figures is actually closer to a true picture of what is taking place in the UK jobs market.

A large proportion of the new jobs created since the 2008-09 recession have been part-time. But yesterday's figures showed a 4,000 fall in part-time employment.

John Zhu of HSBC said the UK jobs market was likely to weaken: "Growth in employment is losing momentum. With surveys suggesting cuts, the falls in unemployment may reverse."