The North East has reclaimed its unwanted position as the unemployment blackspot of the UK after the region’s joblessness rate rose sharply.
The rise in the region’s unemployment rate to 5.7% came as the national level fell slightly in the three months to the end of November. That meant the North East overtook London - which had been hardest hit for job losses during the pandemic - to have the highest rate of unemployment in the country.
New figures from the Office for National Statistics (ONS) also show that the unemployment rate for women in the region is, unusually, higher than that of men.
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The North East’s rising unemployment is running counter to the national picture, with all but one other region (the North West) seeing a quarterly fall in the number of people out of work.
Jonathan Walker, policy director at the North East England Chamber of Commerce, said: “This morning’s statistics should be a huge wake up call to Government about the challenges facing our region. While most parts of the country saw a fall in their unemployment rates, the North East was one of only two regions to see an increase, while our employment rate fell at the same time.
“Despite the rhetoric, the effects of ‘levelling up’ are yet to be borne out in this data. While this is obviously a long term project, the longer the gaps between regions are allowed to grow, the more daunting the task becomes.
“Our own survey data shows that while businesses continue to bounce back from the pandemic, they face challenges in recruiting the right skills as well as severe headwinds caused by inflation and rising energy prices. If the costs of doing business are not addressed, then there is every chance that job creation will suffer.”
North East LEP chief executive Helen Golightly said: “Today’s statistics make for difficult reading. The North East region’s latest employment rate was at 70.5%, which is by far the lowest in England.
“We’ve seen consistently over the previous three quarters that the number of people in work has fallen and that the number of people who have left the labour market and are categorised as economically inactive has increased. Significantly, the unemployment rate – this is people who don’t have a job, but are actively looking for work - has increased to a level that exceeds London, something we’ve not seen since September 2020.
“We are doing further analysis of these figures to understand the detail behind these changes, but it is clear that whilst other regions are moving ahead as they recover from Covid-19, the North East continues to face labour market challenges.
“We are expecting the Government’s Levelling Up White Paper to be published and it is clear that this is increasingly urgent to better understand how Government want to work in partnership with the North East to support us with our economic recovery to address these gaps and avoid further economic imbalance.”
The ONS said the number of UK payrolled workers jumped by a record 184,000 month on month in December to 29.5m, with the number of people employed nationally now 409,000 above levels seen before the pandemic.
But the new figures also laid bare the toll of recent soaring prices on household finances, with the ONS revealing that wages after taking account of inflation fell in November for the first time since July 2020.
Commenting on the national picture, Chancellor Rishi Sunak said: “Today’s figures are proof that the jobs market is thriving, with employee numbers rising to record levels and redundancy notifications at their lowest levels since 2006 in December.”
