According to a new report, official unemployment figures in the UK may be an underestimate. The report challenges the government’s figures which suggest that unemployment is at a record low.
The thinktanks Centre for Cities and the Organisation for Economic Co-operation and Development (OECD) have published a report on economic inactivity in the UK. It shows that many people discouraged from looking for work have been excluded from the government’s figures for unemployment.
The Office of National Statistics estimated 4.6% of the working-age population in the UK as being unemployed in 2017. However, this new report suggests the actual number of unemployed people may be higher due to ‘hidden unemployment’.
Where the official figure takes into account people actively looking for work, it excludes those who may stop looking due to a perceived lack of jobs. For example, in areas where they don’t think it’s possible to find work. People with disabilities or health conditions may also stop looking for work if they can’t find flexible or accessible opportunities.
When the hidden unemployed are added to official unemployment statistics, the number of working-age jobless people not in education is estimated to jump from 4.6 per cent to 13.2 per cent
The OECD website says:
Unemployed people are those who report that they are without work, that they are available for work and that they have taken active steps to find work in the last four weeks. When unemployment is high, some people become discouraged and stop looking for work; they are then excluded from the labour force. This implies that the unemployment rate may fall, or stop rising, even though there has been no underlying improvement in the labour market.
Response from the Office for National Statistics
A spokesperson from the Office for National Statistics said its figures are based on internationally agreed definitions. They went on to say:
If the definition were widened, for example by including people not looking for work because of health problems, it would stop being a measure of spare employment capacity
Centre for Cities has said the report challenges the government’s claim that the UK has had “a job creation miracle” resulting in low unemployment.
Featured image via Wikimedia/ J J Ellison
We need your help ...
The coronavirus pandemic is changing our world, fast. And we will do all we can to keep bringing you news and analysis throughout. But we are worried about maintaining enough income to pay our staff and minimal overheads.
Now, more than ever, we need a vibrant, independent media that holds the government to account and calls it out when it puts vested economic interests above human lives. We need a media that shows solidarity with the people most affected by the crisis – and one that can help to build a world based on collaboration and compassion.
We have been fighting against an establishment that is trying to shut us down. And like most independent media, we don’t have the deep pockets of investors to call on to bail us out.
Can you help by chipping in a few pounds each month?