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Charles Levy
Senior Economist
Charles  Levy

A white knuckle ride?

Authors: Charles Levy Charles Levy

13 October 2010

Today’s numbers from the ONS show the UK generated 178,000 new jobs in the three months to August. But, employment growth is still dominated by an expansion in part time work. In the three months to August 1.1m part-time workers claimed to be only working part time because they couldn’t find a full-time job (65,000 more than three months before). 600,000 individuals appear to be in temporary employment because they can’t find a permanent job (again up 38,000 on the previous three months). Also churn in the labour market remains high – as the ONS highlighted earlier this week, the numbers of individuals moving into employment from unemployment or inactivity (rather than just out of) has remained strong through the recession.

Unemployment remains flat. People previously classified as economically inactive are starting to look for work – swelling the unemployment statistics. This hints at just how many individuals would like to enter the labour market, but are holding off their job search until prospects of success improve. Yet, the number of vacancies in the economy are falling, particularly in large companies.

Together, these numbers paint a picture of millions of workers just managing to cling on to the edge of the labour market – taking on part-time or temporary work where they can, and transitioning in or out of employment. Millions more are trying to grab on. We know that the economy is in for a rough ride in the coming months – the CSR and public spending cuts will certainly represent a major test. What we don’t know is how many of these workers will be able to hold on strongly enough to help build a sustained recovery.

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