Unemployment has shot up to a 17-year high of 2.57m across the UK, worse-than-expected official figures showed today.
The 114,000 increase between June and August took the official jobless rate to 8.1% – and immediately triggered calls for the Government to take firm action to avoid further increases.
In the South West the number of people out of work climbed by more than 13%, leaving 175,000 people unemployed in the region, according to the Office for National Statistics (ONS) – up 21,000 on the same period last year.
The overall South West unemployment rate is 6.6% – up 0.8% on last year – while the numbers of 18 to 24-year-olds classed as being economically inactive also rose by 6.2% on last year.
The South West traditionally performs better than the national average as it relies less on public sector employment. However, today’s figures are a serious blow to the regional economy at a time when many firms are struggling in tough markets and few are recruiting.
Across the UK the unemployment total for 16-24 year olds hit a record high of 991,000 in the quarter, a jobless rate of 21.3%, raising concerns of a whole generation blighted by lack of work opportunities.
The number of people out of work and claiming benefits rose 17,500 to 1.6m in September, the figures showed. No data for individual towns and cities is available but since the recession kicked in three years ago Swindon has suffered a higher jobless rate than the South West average, although lower than the UK.
Other national figures released this morning show a record cut in the number of part-time workers, down by 175,000, and there was also a record reduction of 74,000 in the number of over-65s in employment.
Employment secretary Chris Grayling blamed the impact of the international financial crisis.
He said although the UK was not in the euro, it was “not immune” to the problems being experienced in the eurozone and in countries such as Greece.
There have been criticisms of the government's deficit reduction programmes, with some analysts saying it was hampering economic growth.
However, shadow work and pensions secretary Liam Byrne said the news marked “a day of judgment for the government”.
“Today’s figures are the clearest proof yet that the government’s decision to cut too far and too fast is hurting and just not working. Unemployment is soaring, and more young people are out of work than ever before,” he told the BBC.
And TUC general secretary Brendan Barber added: “These are terrible figures. The government’s austerity measures have turned unemployment into a full-blown crisis – with job losses not seen since the darkest days of the recession.
“Worryingly, this is not simply the result of eurozone troubles. This unemployment crisis is state-sponsored."
Reactions from economists were mixed reaction with some pointing out that most of the job losses were among part-time workers. However, all believe that unemployment is likely to get worse before it gets better as the private sector struggles to create enough jobs to replace those lost in the public sector.
