Labour market summary
The Executive is pressing companies to recruit employees, as joblessness remains high. School leavers, graduates and claimants coming off benefits are most at risk of unemployment.
Businesses must take the initiative and take on staff, according to the Executive, which has pledged £19 million to help create new jobs.
In May-July 2011, unemployment stood at 7.4 per cent, representing 64,000 people. The claimant count (for August) stood at 60,400 as not all unemployed persons claim benefits. There are 7,000 more unemployed people and 2,900 more claimants than in the same periods last year.
In a frank assessment, Arlene Foster said it was “extremely hard” to tackle the problem given the difficult trading conditions in the world economy.
Rising unemployment is a national and global trend but contributes to public disillusionment with Stormont. The restoration of devolution coincided with the peak of a historic boom (4.1 per cent rate in early 2007) yet that growth was built on the unstable foundations of property and public spending.
The Executive’s main effort to create jobs is Invest NI’s Short Term Employment Scheme, which aims to create 4,000 jobs by 2014. The scheme was launched in April and Arlene Foster wants all businesses which could benefit from this support to speak to Invest NI immediately. That scheme also provides start-up business funding for residents of deprived areas and young people not in education, employment or training (NEETs).
Services and construction have been particularly hit according to the Quarterly Employment Survey (March-June), down 1,520 and 500 respectively. Manufacturing (up 70 jobs) and other industries (up 110 jobs) both experienced slight increases.
The number of under-25s in the dole queues was 19,500 in August, mostly young men (13,459). Geographically, the claimant rate remains highest among men in Derry (11.7 per cent) and Belfast (10.7 per cent).
While the province’s economic inactivity is still the UK’s highest (27.7 per cent), it has fallen from 28.6 per cent in May-July 2010. Ill and disabled persons make up the largest share of the economically inactive (31 per cent), with other categories including students, carers and the retired.
The UK Government credits its welfare reform programme with bringing more people off benefits and into the workforce. Caseloads for incapacity benefit and income support for lone parents have decreased over the last year. However, jobs for those potential employees are currently scarce.
Writing in last month’s edition of agendaNi, economist Neil Gibson forecasted that less than 3,000 jobs per annum would be created over the next 10 years. Public sector recruitment freezes and procurement cuts will only worsen youth unemployment. In 18 of the 26 council areas, there would be fewer people in work in 2022 compared to 2008 (and therefore less money to spend locally.)
As the UK’s unemployment total reached 2.51 million (7.9 per cent), the Government insisted that deficit reduction must continue as planned and ministers were “confident” that the private sector would continue to recover and create jobs.
They point to cuts in corporation tax (currently 26 per cent for large companies and 20 per cent for SMEs) as a measure to stimulate growth. However, despite the intense business lobbying for a lower Northern Ireland rate, Sammy Wilson predicts this will not happen before 2015.
