Unemployment in the North East has stayed unchanged but the region has regained its unwanted record of having the highest rate of joblessness in the UK.
New figures from the Office for National Statistics (ONS) show the region’s unemployment rate between September and November last year was 4.7%, the same as figures released last month. That figure was a rise on two previous record lows, but still historically low for the region.
The fall in unemployment at the end of last year had seen the West Midlands become the region with the UK’s highest unemployment, but that situation has now reversed and the North East is at the bottom of the jobs table. There was some positive news for the region, though, as the rate of people classed as being ‘economically inactive’ fell slightly to 24.6%.
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Helen Golightly, chief executive of the North East LEP, said: “At this time, when people and businesses are focused on the cost of living and costs of doing business, it is notable that PAYE data released today saw pay rises averaging 6.4%. This was failing to keep pace with inflation caused by price increases in products including food and energy, which in real life terms sees a further net drop in incomes of 2.6% for the third quarter in a row. Private sector pay growth nationally was running at 7.2% compared with just 3.3% in the public sector.
“As we progress through the winter, the cost of living will continue to be an issue of concern for residents and employers and is likely to continue to impact on sectors of the economy which rely on discretionary spending. For example, entertainment and transport were the sectors which had seen the largest decline in employment in this quarter.”
Callum George, a policy adviser at the North East England Chamber of Commerce, said: “In last month’s reaction to employment figures, we said that the unemployment rate would be worth keeping an eye on as the recession deepens. We know from our most recent Quarterly Economic Survey that staff costs are one of employers’ main concerns going into 2023.
“We know that Prime Minister Sunak is determined to get people who are economically inactive back into the workforce, which is extremely important. However, if unemployment rates and financial pressures continue to worsen, businesses may also need more support in maintaining their current workforce.”
Nationally there was a rise in the proportion of working-age people who were unemployed from 3.5% to 3.7%.
ONS director of economic statistics Darren Morgan said: “In the most recent three months, employment levels were largely unchanged on the previous three months. However, unemployment rose, driven by more young people who have only recently become unemployed, meaning overall there was a small increase in people actively engaged in the jobs market, whether working or looking for work.
“Vacancies fell again, though remaining at very high levels, with the number of people looking for work broadly in line with the number of jobs being advertised. The real value of people’s pay continues to fall, with prices still rising faster than earnings. This remains amongst the fastest drops in regular earnings since records began.”
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