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Youth unemployment could top 1 million again next year

jobs, young people

Published date:  10 Dec 2012

Year and a half before unemployment falls

An extra two hundred thousand people in Britain could be without a job by this time next year, according to new analysis by the think tank IPPR. The latest unemployment figures are published on Wednesday and could show a fall.

But while unemployment has recently been falling, IPPR analysis of the Office for Budget Responsibility’s latest forecasts shows there could be worse to come next year. Unemployment will not ‘peak’ until 2014, according to the OBR, and might not get back to where it is now until the end of 2015.

IPPR analysis - based on the pattern of the increase in 2011, a period of similar labour market change - shows that 86,000 extra young people aged under 25 could join those already unemployed. IPPR analysis also shows that long-term unemployment could rise by 32,000 to a total of 926,000. An extra 47,000 people aged over 50 could become unemployed.

IPPR North analysis shows how, around the country, unemployment could rise next year:

  • an extra 64,000 people could be unemployed in the North West
  • an extra 53,000 people could be unemployed in London
  • an extra 23,000 people could be unemployed in Yorkshire & Humberside
  • an extra 20,000 people could be unemployed in the East of England
  • an extra 20,000 people could be unemployed in the North East
  • an extra 18,000 people could be unemployed in Scotland
  • an extra 12,000 people could be unemployed in Wales
  • an extra 7,000 people could be unemployed in the South East
  • an extra 4,000 people could be unemployed in the East Midlands

But unemployment could fall by:

  • 11,000 in the West Midlands
  • 7,000 in Northern Ireland
  • 2,000 in the South West

Spencer Thompson, IPPR Researcher, said:

“While unemployment has been falling over recent months, the latest forecast from the OBR suggests that worse is to come. With the economy predicted to return to negative growth, the forecast for unemployment is bad news too.

“The outlook is especially bleak for young people and the long-term unemployed. Hundreds of thousands are at risk of permanent ‘scarring’ in the labour market: having their long-term outlook damaged by long periods of unemployment or by a difficult and patchy entry into the world of work.

“The Government should guarantee a job, paid at the minimum wage or above, to anyone who has been out of work and claiming JSA for more than 12 consecutive months. If people do not want to take up this offer, they should be expected to find an alternative that does not involve claiming JSA.”

Notes to Editors

The latest unemployment figures are available from:
http://www.ons.gov.uk/ons/rel/lms/labour-market-statistics/november-2012/statistical-bulletin.html

IPPR North’s final report of the Northern Economic Futures Commission is available from:
http://ippr.org/publication/55/9949/northern-prosperity-is-national-prosperity-a-strategy-for-revitalising-the-uk-economy

IPPR’s report – Jobs for the Future: The path back to full employment in the UK - is available fromhttp://www.ippr.org/publications/55/7938/jobs-for-the-future-the-path-back-to-full-employment-in-the-uk

IPPR’s report – A path back to growth – is available from:  http://ippr.org/publication/55/9438/a-path-back-to-growth

Contact

Richard Darlington, 07525 481 602, r.darlington@ippr.org