The number of people on jobseeker’s allowance (JSA) unexpectedly shot up last month, official figures revealed today, as the number of women claimants hit a 14-and-a-half year high.
The so-called claimant count increased by 12,400 last month to 1.47 million, the largest increase in 16 months, the Office for National Statistics said. Economists were expecting a decline of between 4,000 and 10,000.
The number of women claiming JSA increased by 9,300 to 474,400, the highest level since October 1996, while the number of male claimants increased by 3,100 to 994,200.
The surge in the female claimant count came as more single mothers switched from income support to JSA, due to changes to benefit rules introduced in 2008, the ONS said.
Elsewhere, unemployment fell by 36,000 in the quarter to March to 2.455 million, a rate of 7.7%, down by 0.1% on the quarter.
Economists warned that unemployment is likely to head up over the coming months, despite the improvement seen in today’s figures, as the Government’s austerity measures bite.
Howard Archer, chief UK and European economist at IHS Global Insight, has forecast unemployment to increase to 2.67 million by the end of this year.
He said: “We suspect that likely below-trend growth will mean that the private sector will be unable to fully compensate for the increasing job losses in the public sector that will result from the fiscal squeeze that is now really kicking in.”
The number of jobless 16 to 24-year-olds decreased by 30,000 over the quarter to 935,000.
The number of jobless 16 to 17-year-olds decreased by 1,000 on the quarter to 211,000 while the number of unemployed 18 to 24-year-olds fell by 29,000 to 724,000.
The improved figures come just days after the Government unveiled a £60 million package aimed at boosting work prospects for the youth sector.
The number of unemployed men fell by 31,000 on the quarter to reach 1.43 million, while the number of unemployed women fell by 5,000 to reach 1.03 million.
Employment has increased, showing a 118,000 rise on the quarter to 29.24 million, but the figure is still 332,000 lower than the pre-recession peak reached in May 2008.
The latest increase was driven by full-time employment, which rose by 94,000 on the quarter to reach 21.3 million.
Total average weekly earnings, including bonuses, increased by 2.3% in the year to March, the ONS said, a slight improvement on the year to February.
A toxic combination of muted wage growth and soaring inflation has clamped down on household spending power in recent months and the knock-on effect is hitting all sectors of the economy.
Employment Minister Chris Grayling welcomed today’s figures.
He said: “These are welcome figures showing another rise in full-time employment in the private sector.
“It’s good news to see that unemployment is also going in the right direction and pleasing that unemployment has fallen for young people.
“We’re determined to tackle youth unemployment, which is why we’ve taken steps to ensure that young people get the best possible support to get back to work, including lining up thousands of employers to provide work experience places and introducing apprenticeship places.
“From next month our new Work Programme will be available for people of all ages who need extra tailored support to get into jobs.”
Shadow work and pensions secretary Liam Byrne said: “We welcome any glimmer of good news but today’s figures are a sign we are not out of the woods by a long stretch.
“The claimant count is up, vacancies are down and this is before the wave of public sector redundancies and school leavers come on to the books.
“A host of respected business organisations are warning that choppy waters are ahead, and this is why we are saying the Tory-led Government needs to do far more to get Britain back to work.”
He added: “Most right-thinking people think the Government need to do more. Not least because failing to get Britain back to work fast enough is pushing up the welfare bill by £12.5 billion – that’s £500 per household. That is simply irresponsible economics.”
TUC general secretary Brendan Barber said today’s figures were positive for those looking for work but warned new jobs were not being shared evenly across he country.
He said: “Merthyr Tydfil is now the hardest place in Britain to find a job, followed by the Scottish industrial heartlands and inner London, where over 20 dole claimants are chasing every vacancy.
“With spending cuts just starting to take effect and expected to lead to heavy job losses later this year, we are still concerned that the good news may not last for much longer.”
Ian Brinkley, director of socio-economic programmes at the Work Foundation, said: “These figures are much better than expected given the apparent lack of growth in the economy.
“The strong growth in full-time jobs is especially encouraging, as this is one of the key indicators of a sustainable recovery. It now looks likely that the economy expanded more strongly than last month’s provisional estimates for output growth suggested.
“However, the impact on the unemployment totals was modest because so many more people are entering the labour market looking for work.
“Young people in particular are still facing tough conditions. There is little sign of a significant recovery in the employment for those under 25. Employers looking to hire may be going for experience over youth.”
Dave Prentis, Unison general secretary, said it was “tragic” that women and young people were bearing the brunt of a “bankers’ recession”.
He said: “As public sector job losses gather pace, the number of women out of work will keep on rising. This is a huge backwards step for equality, and a direct hit on families who are already struggling to cope.”
Unemployment in the regions between January and March was:
North East 131,000 plus 4,000 10.4%
North West 265,000 plus 3,000 7.8%
Yorkshire/Humber 244,000 minus 1,000 9.2%
East Midlands 177,000 minus 7,000 7.7%
West Midlands 255,000 minus 4,000 9.5%
East 187,000 minus 8,000 6.2%
London 384,000 plus 6,000 9.1%
South East 255,000 minus 17,000 5.7%
South West 176,000 plus 11,000 6.6%
Wales 112,000 minus 10,000 7.7%
Scotland 208,000 minus 8,000 7.7%
Northern Ireland 61,000 minus 6,000 7.2%