Unemployment rises in the West Midlands

The number of people out of work across the region increased in the three months to the end of July, new figures show.

For the West Midlands there were 149,000 unemployed, 3,000 more than the previous three months. The region's unemployment rate rose to 5.1 per cent.

Meanwhile, there was a slight fall in the number of people in work in the West Midlands, down from 2.79 million to 2.77 million. The employment rate fell to 74.2 per cent.

Nationally, UK worker numbers have rebounded to pre-pandemic levels after the biggest jump in employment since 2014.

The Office for National Statistics (ONS) said the number of UK workers on payrolls rose by 241,000 between July and August to move 1,000 above levels before the coronavirus outbreak.

It also said the rate of unemployment dropped again, to 4.6 per cent – in line with analysts' predictions.

Meanwhile, vacancy numbers soared by 249,000 to more than one million for the first time since records began amid labour shortages in some key UK industries.

Nationally numbers claiming unemployment benefits, including Universal Credit, were 2.18 million last month with the West Midlands figure down 6,645 to 230,735 (6.3 per cent of the working population).

Wolverhampton saw claimant numbers fall by 445 to 15,335 (9.4 per cent), with Sandwell down 410 to 17,225 (8.4 per cent), Walsall down 530 to 13,060 (7.5 per cent) and Dudley dropping by 305 to 12,210 (6.3 per cent).

In Staffordshire, claimant numbers fell 800 to 20,340 (3.8 per cent), with Cannock down 155 to 2,755 (4.3 per cent), South Staffordshire down 70 to 2,415 (3.6 per cent), Stafford down 85 at 2,740 (3.3 per cent) and Lichfield having 110 fewer claimants at 2,155 (3.5 per cent).

Wyre Forest, including Kidderminster, was down by 125 to 2,685 (4.6 per cent).

Partnership manager for Jobcentre Plus in the Black Country, Richard Rawlings said it was stepping up efforts with employers to create opportunities for young people through the Kickstart Scheme.

An event in West Bromwich last week saw more than 70 young people interviewed by employers.

Mr Rawlings said new recruitment opportunities were continuing to coming on stream with Salisbury Poultry, a chicken preparation and packaging company based in Bilston, taking on 83 in roles including production, packing, butchery and forklift truck driving.

Sector Based Work Academy programmes were also running to find people for vacancies in logistics, care and green industries.

Vice chairman of Wolverhampton Council's vibrant and sustainable city scrutiny committee, Councillorr Paul Appleby said: “As furlough continues to unwind it is reassuring to see unemployment continue its downwards trend. Whilst the slight drop in unemployment is encouraging it is still incredibly concerning to see that Wolverhampton continues to have the sixth highest unemployment rate in the UK.”

Chancellor Rishi Sunak said: "Today's statistics show that our plan for jobs is working – the unemployment rate has fallen for seven months in a row, the number of employees on payrolls is back above pre-pandemic levels and there were fewer potential redundancies notified in August than at any point since the start of last year.

"As we continue to recover from the pandemic, our focus remains on creating opportunities and supporting people's jobs."

Minister for Employment Mims Davies added: “As we continue to push ahead with our recovery, it’s great to see another significant fall in unemployment and the number of people on payrolls rising by 241,000 in August – the biggest monthly increase on record – showing our Plan for Jobs is working.

“We’re helping employers recruit for the record number of vacancies out there, particularly in growing sectors, and supporting people of all ages and backgrounds to overcome barriers, land their next role, and progress in work.”

Jonathan Athow, ONS deputy national statistician for economic statistics, said: "Early estimates from payroll data suggest that in August the total number of employees is around the same level as before the pandemic, though our surveys show well over a million are still on furlough.

"However, this recovery isn't even: in hard-hit areas such as London, and sectors such as hospitality and arts and leisure, the numbers of workers remain well down on pre-pandemic levels.

"The overall employment rate continues to recover, particularly among groups such as young workers who were hard hit at the outset of the pandemic, while unemployment has fallen.

"Vacancies reached a new record high.

"Not surprisingly, this is driven above all by hospitality, the sector with the highest proportion of employers reporting their job openings are hard to fill."

The ONS also reported a "strong increase" in the employment rate among people aged between 16 and 24, alongside a decrease in the unemployment and inactivity rates.

Young people had seen particularly significant increases in unemployment as retail, hospitality and leisure roles were impacted by the pandemic.

The latest figures showed significant growth in these industries, as they helped push vacancies to record levels.

The number of job vacancies recorded between June to August 2021 was 1,034,000, with the accommodation and food services industry seeing a 75.4 per cent increase in the number of job openings.

Mr Athow added that the hospitality sector recorded "the highest proportion of employers reporting their job openings are hard to fill".

Meanwhile, the ONS also reported a continued increase in wage growth, with total earnings, including bonuses, rising by 8.3 per cent for the three months to July against the same period last year.

British Chambers of Commerce head of economics, Suren  Thiru, said: "The jobs market has continued its summer revival as demand for workers has surged following the easing of Covid restrictions.

“But record vacancies also highlight the acute hiring crisis faced by many firms. With Brexit and Covid driving a more deep-seated decline in labour supply, the end of furlough is unlikely to be a silver bullet to the ongoing shortages.

“These recruitment difficulties are likely to dampen the recovery by limiting firms’ ability to fulfil orders and meet customer demand.

Matthew Percival, Confederation of British Industry director of people and skills, said: “As businesses recouped months of lost trade over the summer, the labour market showed positive signs of recovery too as employment and vacancy figures rose.

“However, ongoing supply and labour shortages are impeding further growth. Whilst firms accept a quick-fix overnight isn’t possible there are temporary and immediate measures the Government must take to ease some of these pressures.

“In the longer-term, this means increasing investment in reskilling, automation and improved pay and conditions. But these steps take time to have impact, so we need a functional Shortage Occupation List too so that firms can temporarily fill the most significant vacancies.

“Government needs to immediately begin a review of shortages and accept the Migration Advisory Committee’s recommendations from last year to add extra jobs to the list”.

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