Region bucks national trend as unemployment grows

UNEMPLOYMENT in the West Midlands bucked the national trend and rose by 10,000 at the start of this year, latest figures show.

Figures compiled by the Office for National Statistics show unemployment rose to 178,000 in the region during the three months endings March 31. That is a rate of 6.4%.

The region was not alone in seeing a rise; Yorkshire and the Humber, East Midlands, Scotland and Northern Ireland all saw rises.

This was at odds with the picture nationally where the figure fell 35,000 to 1.83m (a rate of 5.5%) – however, this was the lowest quarterly fall since the three months ending August 2013.

Nevertheless, there are still 41,000 fewer people out of work in the West Midlands than there were this time last year.

In response to the rise, business leaders in Birmingham called on the new government to provide greater incentives for firms to take on the unemployed.

Greg Lowson, president of Birmingham Chamber, said the picture was rather confusing and may be just seasonal fluctuation.

“This underlines that it’s very much work in progress in the West Midlands and that any temptation to increase interest rates should be resisted,” he said.
 
“There is still a great deal of work to do especially in the heart of Birmingham, where the chamber is addressing the issue through its links with businesses and the nine colleges of further education which form The Skills Hub.
 
“Businesses need a continued period of stability in order to deliver the growth and prosperity that we want to see and in that respect the government can provide incentives through the reduction in red tape promised by the Conservatives in their pre-election campaign.”

Fellow chamber Coventry and Warwickshire prefers to focus on the latest monthly figures, which show unemployment in Coventry dropped from 4,789 to 4,673 in April and, in Warwickshire, from 3,552 to 3,426.

Louise Bennett, the chamber’s chief executive, said there was confidence among many of its members that they would be taking on new staff over the next 12 months.

She said the new Government’s commitment to new apprenticeships and maintaining growth was promising but that there should be no complacency about the economic picture.

“The latest figures are very welcome and, again, are testament to the businesses of Coventry and Warwickshire who are growing and taking on new people,” she said.
“Our last Quarterly Economic Survey suggested there was potential for an even greater fall in unemployment and that is certainly something the new Government has said it will provide the policy to support.”

Mark Smith, regional chairman at PwC in the Midlands, was one of those to assess the bigger picture.

He said: “The British economy remains an incredible job creating machine, with employment rising by around 200,000 in the latest quarter to a total of above 31m for the first time.

“The employment rate also rose to a new record high of 73.5%, while unemployment continued its fall to 5.5%, not much higher than before the financial crisis. Vacancies also rose to a record high of 745,000, indicating that it is becoming harder to fill the job openings that are arising.

“There are also more convincing signs than ever before that this extra demand for labour is causing the market to tighten, pushing up regular pay growth to 2.2%. With consumer price inflation stuck at zero, workers are experiencing solid real pay rises for the first time since the recession. This should help to support the domestic economic recovery at a time when international economic prospects remain very mixed.”