The claim
“As well as laying waste to our public services, cuts have a stranglehold on the private sector.”
Dave Prentis, 11 March 2013
The background
Britain’s biggest public sector trade union laid into the government’s economic strategy today.
Unison said there were four unemployed people on average chasing every job in England, Scotland and Wales.
And in some parts of the country, according to the union, things are much worse. The ratio is ten job seekers for every job in 26 council areas, Unison claimed.
Dave Prentis, Unison’s general secretary, blamed this state of affairs on George Osborne’s austerity agenda, saying: “The government has got it wrong on the recession and it has sacrificed our recovery.”
How bad have things got for people chasing work? And is this evidence of a bankrupt economic strategy?
The analysis
The union has drawn on research published by the Office for National Statistics here.
The Nomis website is pretty user-friendly and if you type in the name of your local authority in the search box you can compare the number of people claiming jobseeker’s allowance with the number of vacancies advertised by local branches of Jobcentre Plus.
About four jobseekers are chasing one vacancy on average across England, Wales and Scotland, but there are huge regional variations.
Inner London is almost twice as bad, while the Isle of Wight appears to have the worst job shortages, with nearly 24 claimants per job centre vacancy.
Unison says all this but doesn’t point out that nationally, things are getting better, not worse, on these figures.
The latest figures are from November 2012, when there were 3.8 people claimants for every job. That’s a better ratio than in the same month in 2011, 2010 or 2009. We have to go back to 2008 to find a lower rate.
Things are clearly still worse than they were before the banking crisis of 2007/08: there were only one or two unemployed people per vacancy in 2006 and 2007.
But there are some signs of improvement, and the ratio is significantly better now than it was in the months leading up to the 2010 election.
But can we trust these statistics?
The trouble with these numbers is that they are based entirely on Jobcentre Plus computer data handed over to the Office for National Statistics (ONS), and the independent statisticians cannot guarantee their accuracy.
For example, it could be the case that jobcentres suddenly report a massive increase in vacancies, but a much bigger proportion might be part-time rather than full-time jobs.
Or it could be that the same vacancy is being duplicated on the books of job centres in different council areas. Again, we have no way of telling.
We’re not accusing the Department of Work and Pensions of cooking the books. For all we know, it could be that changes in the way vacancies are counted make the situation look worse than it is rather than better.
But we know that there have been changes over the years, and the ONS cannot vouch for the accuracy of these figures.
The official line is: “Interpretation of the series needs to take account of changes to Jobcentre Plus procedures for taking and handling vacancies. As a result, the figures are not fully comparable over time and may not indicate developments in the labour market.”
We also have to remember the obvious points that not everyone who is unemployed and looking for work claims jobseeker’s allowance, and not every vacancy that comes up is advertised in job centres.
There is an alternative way of looking at this. The ONS keeps another tally of job vacancies nationwide, based on the Labour Force Survey.
These are more statistically robust, and seasonally adjusted, but don’t enable us to zoom in on every town in the country.
Here’s the latest ONS graph: there’s a huge drop in vacancies in 2008 but things pick up a bit in 2009 and there’s been a slow increase since then.
In the latest quarter where we have the full figures, October to December 2012, there were 495,000 vacancies in the whole of the UK and there were 2.5m unemployed people (including people out of work but not claiming jobseeker’s allowance).
This gives us an alternative ratio of about five jobless people for every vacancy – 5.1 to be exact.
This number is twice as high as it was before the crash, but it has been falling over the last year.
Private sector jobs
Unison points out that more than 500,000 public sector jobs have gone since the coalition came to power, which is true, but again, they are only telling half the story.
We’ve taken issue before with government claims to have created more than one million private sector jobs since the election.
It makes a big difference whether you start counting in the second or third quarter of 2010. And a reclassification of jobs in FE and sixth form colleges added just under 200,000 jobs to the private sector tally in one fell swoop last year.
Depending on which of these assumptions you accept, the government has overseen the creation of anything from 853,00 to 1.3m private sector jobs since the election.
But either way, that is a lot more than the number that have been cut from the public sector over the same period: 370,000 to 583,000, depending on when you start counting and what you do with the college jobs.
The verdict
We don’t think these vacancy figures quite show what the union wants them to show.
The first thing you have to decide is whether you trust the statistics provided by Jobcentre Plus’s computerised database.
If you do want to use them, it’s perfectly true to say that there are now an average of four people chasing one vacancy nationwide, and evidence of local black spots.
But you have to acknowledge that this is evidence, if anything, of a recent improvement in the employment market, not a deterioration.
The best alternative measure we have also shows a slight upturn over the last year.
And the union has neglected to mention the fact that private sector job sector creation has so far outstripped the number of public sector jobs axed since 2010 – as George Osborne said it would.
Of course we could then have an argument about whether the pace of improvement is fast enough, and whether a different approach to the economy would have created a speedier recovery. But that’s impossible for us to prove either way.
By Patrick Worrall
