West Midlands bucks trend with slight rise in number out of work

The number of jobless people in the UK has dropped below levels seen before the pandemic struck for the first time, but earnings continue to fall behind rocketing inflation, according to official figures.

The Office for National Statistics (ONS) said there were 1.34 million unemployed in the quarter to January, down 88,000 on the previous three months and below the 1.36 million recorded in December to February 2020.

The unemployment rate fell back once again, to 3.9 per cent in the most recent quarter.

It came as the number of workers on payrolls jumped by 275,000 between January and February to a fresh record of 29.7 million, with the ONS saying demand for workers "remains strong".

Vacancies also hit a new high, up 105,000 quarter on quarter to 1.3 million as firms scrambled to secure staff amid a recovering wider economy.

The unemployment total for the West Midlands for the three months to January was 148,000 – a rate of 4.9 per cent of the working population. The number in employment was 2.84 million.

Numbers claiming unemployment benefits, including Universal Credit, increased across the West Midlands in February by 1,370 from January to 199,220 – 5.4 per cent of the working population.

In the Black Country, Wolverhampton had 65 more claimants at 13,140, but elsewhere Walsall fell by 100 to 11,065, Sandwell was down 50 to 14,830 and Dudley had a drop of 20 to 10,510.

In Staffordshire the numbers claiming were up 25 to 16,810. South Staffordshire saw a drop of 10 to 2,075 with Cannock Chase up five to 2,260 (3.5 per cent), Stafford up 35 to 2,345 and Lichfield having 10 fewer claiming at 1,720.

Wyre Forest, which includes Kidderminster, had 55 more claimants at 2,275.

Richard Rawlings, partnership manager for Jobcentre Plusn at West Bromwich, said that there had been a 21.5 per cent increase in online jobs advertisements.

"As part of the Way to Work campaign we are working with training providers and colleges to ensure jobseekers have the skills to get jobs coming on stream in care, security, hospitality and construction.

"People can go to Jobcentres across the Black Country to find out how they can get the right skills," he explained.

There are now 16 new temporary Jobcentres and 12 youth hubs open in the region to help jobseekers get tailored face-to-face support to help them get into work or progress within their jobs

The ONS figures also revealed the ongoing pressure on household finances, as regular pay failed to keep up with soaring inflation, with average weekly earnings up 3.8 per cent, excluding bonuses.

This was 1.6 per cent lower than Consumer Prices Index inflation over the same period, according to the ONS.

Grant Fitzner, chief economist at the ONS, said: "The labour market continues to recover from the effects of the pandemic, with the number of unemployed people falling below its pre-pandemic level for the first time and another strong rise in employees on payroll in February.

"However, the number of people out of work and not looking for a job rose again, meaning total employment remained well below its pre-pandemic level.

"We have seen yet another record number of job vacancies and, with the redundancy rate falling to a new record low, demand for workers remains strong."

Suren Thiru, head of economic at the British Chambers of Commerce, said: “Rising payroll employment and declining unemployment suggests that demand for workers remains robust despite growing headwinds.

“Although there was a modest pick-up in regular pay growth, wages are still comfortably trailing behind inflation, which is putting the brakes on consumer spending by eroding their spending power and confidence.

“Record vacancies highlights chronic imbalances in the UK labour market with demand for workers outpacing supply. With rising economic inactivity indicating a deep-seated decline in worker participation, particularly among older people, recruitment difficulties may persistently drag on economic output.

“While demand for labour is currently strong, the damage to firms’ finances from rising cost pressures, a weakening economic outlook and next month’s national insurance rise may significantly squeeze recruitment intentions and pay growth in the near term.

“We urge the Chancellor to use next week’s Spring Statement to delay the National Insurance rise by one year to give firms the financial headroom to weather this surge in costs facing businesses and support the wider economy.”

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