The British economic strength and its resistance to the Euro crisis is starting to be called into question after a study was published showing an increase of 70,000 people out of work.
The rate of people without a job in the United Kingdom stood at 7.9% in the quarter spanning from December of 2012 to February 2013, implying a tenth more than the registered unemployment of the period from November 2012 to January 2013.
This increase of 70,000 people leaves a total of 2.56 million unemployed in the UK according to details offered at the start of April by the Office for National Statistics (ONS).
These details had not been released since August 2012, when the increase stood also at 7.9%. The figure, although still negative, stands four percentage points under the all time maximum of 11.9%, registered in the UK in the middle of the 1980s.
The data from the ONS also revealed that 900,000 people have been without a job for more than a year, an increase of 8,000 on the three months up to November.
Just as is happening in the rest of Europe, the youth are those who feel the crisis most. Unemployment amongst youths of 16-24 years-old increased by 48,000 between November and January, now reaching 993,000.
It is a rate of 21.2% that, while still high, stands below the average of the EU, which in 2012 was 22.8%. These rising results have grown away from the 15.7% rate of 2007, the year that the economic crisis started.
Spain (53.2%), Greece (55.4%), Portugal (37.7%), Italy (35.3%), Slovakia (34%) and Ireland (30.6%), in this order are the Euro zone countries with the highest unemployment rate.
As for districts in London, the one that registered the highest unemployment rate was Hackney South with 5,987 people (8.1%), followed by Tottenham (8%, or 6,320 people), Poplar & Canning (7.4%, or 6,749 people), and Walthamstow (7.4%, or 4,716 people) without work.
8 million people
In accordance with the data from ONS, the number of people signed on for benefits fell by 7,000 people in March to 1.54 million, the lowest figure since June 2011.
Despite this increase of 70,000 unemployed, there are 71,000 fewer people searching for jobs in comparison to 2012. In fact, 60,000 more people enjoy a full time job, which amounts to a total of 21.6 million people.
There has also been a decline of 62,000 people with a part time job, currently there are less than 8 million.
“The data from the job market is clearly lower in comparison with the records from a couple of months ago”, Howard Archer, chief economist for HIS Global Insight, said to The Guardian.
In the same way, the number of people classified as economically inactive, including students, people with long term illnesses and those that have stopped searching for work, was down by 57,000 to 8.95 million.
Almost zero increase in income
The ONS also noted that the average increase in yearly earnings, counting bonuses, settled at 0.8%.
Without counting bonuses, salaries grew by 1%, the smallest rise since records started in 2001. Thus, the office amounted the incomes for workers in the UK to £443 gross weekly (€514) in February 2013 compared to £440 in February 2012.
This directly affects consumption. In fact, analysts project that the gap between salary increases and inflation will continue eroding disposable incomes, a trend marked by the latest data.
George Osborne under pressure
The figures, that reflect a change from the trend of falling unemployment with respect to last year, are published after the International Monetary Fund urged Chancellor George Osborne to ease his austerity plans and implement more aggressive measures to stimulate growth.
Also after the presentation in the House of Commons by George Osborne of the state budget for the fiscal period 2013-14.
These estimates please neither the British society nor the opposition, who urge the Chancellor to change his policy of austerity in order to boost growth.
Additionally, he emphasised that “to top it all off the government is cutting back tax credits and benefits for children but is giving millionaires a tax cut. People have to work almost a month and a half more to be able to do what they did in 2010. Workers are going backwards” he maintains.
Reviews shared by the opposition are bent on setting aside their policy adjustments so as to boost the economic growth of the UK, which in the last quarter of 2012 registered an economic contraction of 0.3%.
Pressure to change towards a more active economy was also put on by the Bank of England, who in recent days announced that it was suspending its policy of injecting funds into the economy (quantitative easing).
These figures sound the alarm about the vulnerability of the United Kingdom and the economic crisis that has threatened Europe since 2008.
(Translated by Ollie Phelan – Email: Oliverphelan@hotmail.co.uk)