North East continues to suffer as unemployment rises

The unemployment rate in the North East remains at 10.3%, as total numbers rose by 7,000 in the three months to June.

According to The Office for National Statistics (ONS), unemployment in the region stands at 134,000 despite the economy showing signs of growth, higher than the national average of 7.8%.

The rate is well above the 7% target rate set by the Bank of England.

The Bank’s governor, Mark Carney, says interest rates are unlikely to rise before that target is reached

Mr Carney said he expected that 750,000 new jobs would have to be created, taking up to three years, to hit the target.

The number of people claiming Jobseeker’s Allowance in the North East in also higher than the national average, with the claimant count at 85,800, or 6.9%, compared to 4.3% nationally.

The ONS said the figures meant unemployment was “broadly unchanged” from the first three months of the year.

North East Chamber of Commerce director of policy Ross Smith, said: “It is good to see both sets of statistics heading in the right direction, no matter how slight the improvements.

“The rise in employment levels is welcome as is the slight drop in unemployment estimates and while one month’s figures do not reverse the negative changes we have seen throughout 2013, hopefully it represents the start of a positive trend towards the end of the year.

“Once again, the main positive from the monthly estimates is provided by the continued fall in claimant count figures, which now stand at their lowest levels for two years.”

Youth unemployment, among those aged 16-24, increased by 15,000 to reach 973,000.

However, Will Moy, director of Full Fact, an independent fact-checking organisation, insisted these figures can be distorted, and need to be interpreted differently.

Speaking to BBC Radio 4’s Today programme, he said: “Ed Milliband [Labour leader] was right o say Britain’s youth unemployment is the second worst by numbers in Europe after crisis-hit Spain, but in that list you have Malta, Luxembourg, Cyprus; so the number of unemployed young people in a country depends on how many young people there are in a country.

“If you looked at what proportion of young people are unemployed in Britain, it is just 20%, two-thirds of the way down the European league table for youth unemployment.

Britain, though, suffered the fourth-worst decline in wages among the 27 EU nations during the economic downturn. Hourly wages have fallen 5.5% since mid-2010, compared to 0.7% across the European Union as a whole.

The ONS released figures showing that wages actually grew by 1.1% over the past 12 months however.

The number of people out of work for more than two years also rose by 10,000 to 474,000, the highest number in 16 years.

The number of people in work increased by 69,000 in the three months to June, up to 29.78 million. That is the highest level since records began in 1971.

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