One British worker loses job every 30 seconds

ALISTAIR Darling said last night that Britain appeared to be on the road to recovery, despite new figures showing that a job was lost every 30 seconds over the past three months.

The Chancellor said in his annual Mansion House speech to the City that there was "growing evidence" that the action taken around the world to stabilise banks and support economies was beginning to work.

But his speech came just hours after figures revealed that unemployment had risen to a level not seen since Labour came to power in 1997. The 2.26 million unemployed include a rising number of white-collar workers.

Mr Darling said there was "a great deal of uncertainty" about the future, but repeated his Budget forecast that the economy would return to growth at about the turn of the year.

"If we remain vigilant to these risks, and take action wherever necessary, I am confident there will be a sustained recovery," he said. "There is still a great deal of uncertainty in the global economy. And we must remain cautious. There is growing evidence that the steps taken, at home and internationally, are stabilising the banking system and supporting our economies.

"And this is in line with my Budget forecast for growth around the turn of the year – and my confidence in the strength and resilience of the British economy in the medium term.

"So I remain confident, but cautious. Confident that the steps to help people into work, and prevent job-loss becoming permanent unemployment, are also making a difference."

The Chancellor's upbeat assessment will please the markets, but it was at odds with the figures published yesterday – even though analysts expect jobless totals to lag behind other economic indicators.

One of the most worrying aspects of yesterday's figures was that young people and those in the most deprived areas have been among the hardest hit over the past three months – youth unemployment has risen to a 15-year high and long-term joblessness is at a ten-year high.

At the same time, the number of people in work fell by 271,000 over the three months to April to 29.11m, the biggest quarterly slump since comparable records began in 1971.

In Scotland, unemployment rose by more than 41,000, taking the total to 176,000. While the unemployment rate north of the Border is still below that of the UK as a whole, this steep rise over the last quarter means Scotland is quickly catching up.

Work and Pensions Secretary Yvette Cooper said: "We will not turn our backs on people who need help. Nor will we stand by while people slip into the kind of long-term unemployment or worklessness that scarred families in past recessions."

TUC general secretary Brendan Barbe warned: "If we are to avoid the 10 per cent unemployment rates of the 1980s and 1990s, it is imperative the government continues to invest in tackling unemployment."

The figures for youth unemployment were particularly bad across the country, with 16.2 per cent – one in six – of 18-24-year-olds unemployed.

Part of the youth unemployment crisis is due to a shortage of new jobs. There is little movement further up the jobs market and more older people are working longer.

In Scotland, the number of 18-24-year-olds on the dole for over six months rose from 2,600 to 5,700 in the year to May 2009, a rise of 120 per cent. In the past two years the number of pensioners in work in Scotland has gone up by 30,000, to 882,000.

Across the board in Scotland, the number of people claiming Jobseeker's Allowance rose by more than 3,500 last month, to 125,000. Scottish Secretary Jim Murphy called the figures a "real blow". He added: "Scotland has shown a greater resilience to rises in unemployment than elsewhere in the UK, but today's figures again show the seriousness of the situation."

Holyrood enterprise minister Jim Mather said Scotland still had lower unemployment than the UK average, adding:

"The recession clearly continues to bite hard, and we remain steadfast in our efforts to position Scotland's economy for a strong recovery, and attract investors to create new jobs."

SET FOR GROWTH

THE Scottish economy is set to return to growth by the end of this year, a leading analyst claimed today.

Lloyds TSB Scotland chief economist Professor Donald MacRae said the services sector would lead Scotland out of the recession. The latest business monitor compiled by the bank and the Fraser of Allander Institute, showed almost half of all companies reported a drop in turnover, but Lloyds said all forward-looking indicators for the coming six months showed an improvement.

Prof MacRae said this potentially suggested a return to economic growth by the end of 2009.