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UK Employment Confidence Increases

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UK Employment Confidence Increases

The Lloyds Employment Confidence figure was released earlier this morning by the Bank and shows sharp positive turnaround in sentiment towards the British jobs market. The indicator rose to 1.0 in April from a negative reading of -2.0 the previous month.

Unemployment in the UK has steadily been returning to more acceptable levels since peaking at 8.4% two years ago. The current reading of 6.9% places it in line with other recovering developed nations, and well below the average of it’s European Union peers which are collectively experiencing an 11.8% unemployment level.

The improving headline unemployment rates in the UK are masking some structural cracks that have the potential to jeopardize the lasting stability of the recovery. Unemployment among the youth demographic is particularly troubling for the authorities. There is an unemployment rate of 21.7% in the category of under 18’s available for work. The 18 to 24 year old category is showing an unemployment level of 17.2%.

More troubling for any economy, not least Britain, is the increasing growth in long-term unemployment. Those number of those registered as jobless for more than one year is growing at an alarming rate and currently stands at over 800k in the UK.

There are regional disparities at play also, the north of England, Wales and Scotland are all lagging behind the more affluent south-east and urban centers around the country.

Finally, in a similar vein to the US, the UK authorities are beginning to acknowledge that the types of jobs being created are not necessarily of the same quality as those that were lost during the crises. Many part time, freelance and ‘zero hour’ contract jobs are replacing the full-time roles that once existed. Average hours worked statistics suggest that the UK’s version of this problem is not as extensive as that being faced in the US but it is nonetheless becoming an issue, along with others, that threatens the longer term prospects for the UK’s employment markets.

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