Lies, Damned Lies : doing a number on the latest job figures

A naked, crowned David Cameron with Nick Clegg as his fool.

[First published in abridged form in The Morning Star, 22/10/12]

“He’s got no clothes!” the child cried. The crowd lapsed into stunned silence; the emperor’s retinue cast worried glances at one another. The laughter would begin any second now, tinged with scorn, and who then would hear the Imperial Edicts?

Then the emperor’s press secretary spoke. “As a matter of fact I have carefully inspected His Holiness’ wardrobe. Today’s waistcoat is a 90% / 10% cotton wool blend. The pea-green stockings are a sumptuous 65% / 35% cotton polyester blend. The shirt is, I am pleased to say, 100% linen, while the cravat…” The heralds quickly took up the call, as did the town criers: The emperor was more richly dressed than ever before, and there were figures to prove it. And his pneumonia would surely clear up any day now.

So it was last week with the latest labour market figures. “More People In Employment Than Ever Before”, trumpeted the Department of Work & Pensions’ press release with the impressive but meaningless figure of nearly 30 million. Britain’s population as a whole is at a record high since 1960; civil servants only began collecting relevant employment data in 1971. You could just as easily say there are more people eating ham sandwiches than ever before.

In fact the employment rate – the metric that governments can actually influence – is at 71.3 percent, a record high since… well, three years ago. So we’re not back even to pre-recession levels — and that’s hardly the worst of it.

Under the Office for National Statistics’ guidelines, ‘employment’ perversely covers not just employees, the self-employed and those in a family business, but also “those on government-supported training and employment programmes” — people who, by any reasonable definition, are not in fact in work.

And it just so happens that this meteoric rise in employment began in June 2011, at exactly the same time the Coalition launched its controversial Work Programme of mandatory unpaid work placements — with, let’s not forget, punitive benefit cuts for those who try to pull out. Since then, nearly three quarters of a million jobseekers have been signed up to the Work Programme – which the ONS is then obliged to chalk up as ‘employment’. They’re still signing on at the jobcentre, they’re still out of work in any meaningful sense. But it looks an awful lot better on paper. Newsprint, especially.

Perhaps some of those people really are in genuine employment now. Who knows, perhaps the Work Programme even helped – but you wouldn’t know it from the figures. As unbelievable as it sounds, the team monitoring the Work Programme’s activity doesn’t actually report how many of these referrals end in paid work. At all.

In fact, if you break down the ‘employment’ boom by category, the rise in actual employees is just 240,000 in the last year – less than half the headline figure employment minister Mark Hoban has been brandishing. And bear in mind that 80 percent of those new jobs are part-time on an average 15 hours a week, largely below living wage and have simply moved people from unpaid labour on workfare to underpaid labour on income support. Hardly inspiring stuff.

The remainder are, as mentioned earlier, the aforementioned poor sods on unpaid placements, unpaid workers in family businesses and the self-employed. In fact, Mr Hoban’s claim of a drop of 50,000 Jobseekers’ Allowance claimants in the last quarter – the figure from which the unemployment rate is calculated – coincides with a combined rise in these three categories of… 50,000. Even the surge of 35,000 new self-employed entrepreneurs is hardly a sign of a booming economy — it’s due in no small part to the government’s drive to move Job Seekers Allowance claimants onto their New Enterprise Allowance for start-up businesses. Keeping a business afloat for long is a difficult feat for anyone in the current economy, let alone people with no nest egg who’ve now been told to take out business loans. We’ll see how well that particular policy works out once the scheme’s lenders start calling in their final repayments in 2015.

What this week’s leaders should have said was this: unemployment has been worse. But not much worse. The increasingly heavy-handed use of benefit sanctions is beginning to artificially depress the rate of JSA claimants, and the vast majority of the Coalition’s public sector lay-offs are still to come. You can hide poverty in the paperwork however you like — but that won’t stop anyone from seeing it in the streets.

3 Comments on “Lies, Damned Lies : doing a number on the latest job figures”

  1. […] guess this is a follow-up to my more detailed breakdown last month of the Coalition’s deceptive portrayal of employment figures. Basically, are the same trends (rising numbers on workfare counted as employment, unpaid workers […]

  2. […] the Morning Star revealed last month, October’s official figures papered over some major cracks in the economy – rising […]

  3. […] As Rory MacKinnon pointed out in his article: […]

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