HC Deb 22 November 1972 vol 846 cc1286-92

Mr. Prentice (by Private Notice) asked the Secretary of State for Employment if he will make a statement on the new form in which the unemployment statistics are to be published tomorrow.

The Secretary of State for Employment (Mr. Maurice Macmillan)

As I told the House on Monday, the Government have accepted the proposals put forward in a report by an inter-departmental working party' on unemployment statistics which have been published as a White Paper.

The report recommends a simplification of the presentation of these statistics. It recommends a single aggregate, described as "the unemployed", which would include school leavers and adult students seeking vacation work. Figures for the temporarily stopped will continue to be shown in the Press notice but separately from those relating to the unemployed.

The report points out that the statistics of unemployment record simply the number of people registered with the Department of Employment as unemployed. These figures are mainly used for two separate purposes. First, as economic indicators. Second, as indicators of social distress. The report concludes that the statistics already provide extremely useful information for both these purposes, provided that they are examined in depth and interpreted with care.

The monthly Press notice issued by my Department will appear in a new form tomorrow. All the main groups—including the temporarily stopped—which have appeared before will be shown in the new Press notice and the seasonally adjusted figures, which are the best indicators of trends, will be on exactly the same basis as before.

But the monthly Press notice will also contain some additional information designed to help those who seek to comment upon or interpret the statistics.

I hope that we shall be able to publish in addition from time to time more comprehensive analyses derived from the figures already available in the Department of Employment Gazette.

Mr. Prentice

The Secretary of State might have explained why, on a matter of this sensitivity, he accepted the report on the same day as it was published, without any chance of public discussion, and why he announced it to the House by way of a Written Answer to an inspired Question. Does not he owe the House an explanation on those matters? Could not he at least make some amends by adopting the suggestion of my right hon. Friend the Leader of the Opposition yesterday that a Select Committee should examine the best way in which the figures should be presented?

On the main substantive point, is not it clear from the recent census figures that real unemployment has been consistently underestimated for many years by the unemployment statistics? Will the right hon. Gentleman acknowledge that his own White Paper which he has just quoted said that there might well have been in 1971 about 400,000 people who were unemployed but whose unemployment was not recorded in the figures, and that many estimates put the figure much higher?

In this situation, how can the Government possibly justify making a change in one direction by excluding the temporarily stopped people, who, after all, are out of work and registered on the day when they are counted, but taking no account of the much larger numbers of people who are unemployed but not registered? Does not that mean that tomorrow's and subsequent figures will under-estimate the real level of unemployment much more seriously than the previous figures?

What possible reason can there be for that, except the Government's desire to fudge the situation and to give the impression that unemployment is less serious than in fact it is?

Mr. Macmillan

I had hoped that, as a result of choosing a moment when unemployment was consistently dropping, the sort of charge that the right hon. Gentleman made, wholly unjustifiably, could be avoided in a serious attempt to deal with the problem of relating statistics collected for a relatively narrow purpose and making them more effective for a wider purpose.

As the right hon. Gentleman knows, the main economic indicator is the figure of wholly unemployed, in the old term, exluding school leavers and adult students. The temporarily stopped have also always been excluded from the seasonally adjusted figure of wholly unemployed. The figures of temporarily stopped indicate something rather different, and they are still published in the Press notice and perhaps given a little more prominence.

One of the reasons why the interdepartmental study concluded that the temporarily stopped should be treated in that way is the erratic nature of the figures, particularly for those who study them most carefully on a regional basis. For example, in the West Midlands from August, 1971, to January, 1972 there was, I regret to say, a steady increase in the number of wholly unemployed, from about 77,000 to about 87,000. The temporarily stopped fluctuated from 16,000 to 52,000 to 45,000 to 46,000, to 34,000, and to 25,000. That was due to a particular situation in that area. Their inclusion in the figures of the wholly unemployed would have given a totally misleading impression of the situation in the West Midlands—at one month more favourable, at another less favourable. It is that sort of situation that the separating of the temporarily stopped, but not their exclusion from Press notice, is designed to avoid.

I turn to what the right hon. Gentleman said about the census figures. There is a number of reasons for the discrepancy between those figures and those on the register. First, the question asked by the census was whether a person was seeking work or waiting to go to a job. Secondly, the census figures included those who were ill. In 1971 the census figures for those seeking work totalled 1,366,000, and the registered unemployed were 730,000. The difference between the two figures is 636,000, of whom 230,000 were sick. That leaves 400,000, of whom there were 100,000 males and 300,000 females.

The 1966 census showed a difference of about 430,000 between those who said that they were seeking work or waiting to go to a job and the registered unemployed. About 200,000 of those were sick, which left a total of 230,000, of whom there was roughly the same proportion of men and women. I regret that I do not yet have from the census figures the equivalent figure for 1971, but of the total in 1966 half the discrepancy is accounted for by those who were waiting to take up work which they already had. In addition, the great majority of the discrepancy in the 1971 figures arises from the fact that half are waiting to take up work.

The problem is that the answer, "Yes" to the question, "Are you seeking work?" depends in many cases on certain conditions. Married women, housewives and others who are available for certain types of work are available only on certain conditions and are not registered at the employment service offices.

Regardless of the effect that it may appear to have on the figures used as an indicator of social distress, I take this opportunity of suggesting that people who are seeking work should register with the employment exchanges, because that is the only way in which my Department can help them to get work.

Mr. John Page

Is my right hon. Friend aware that many informed commentators—not necessarily supporters of the Conservative Party or the Government—who have long felt that the presentation of the unemployment statistics is misleading, will welcome these changes and examine them carefully? Will my right hon. Friend, through the committee, look again at the figure of the unemployable. It is regrettable that the unemployable are dismissed in one short paragraph of the White Paper, and it is thought that they must be quantifiable.

Mr. Macmillan

I am grateful to my hon. Friend for the first part of his remarks. The committee worked on the figures derived from the system as it was of people registered at employment exchanges. From those figures it is not possible to identify either those who are sometimes alleged to be not genuinely seeking work or those who come under any definition of "unemployable". Even the term "unemployable" must depend to some extent on the demand for labour and is a rather subjective term. If it were possible I should like to identify those who are sufficiently socially or otherwise disadvantaged to be classified perhaps with the disabled, but at the moment we have not the capacity to do so.

We are trying to use sampling techniques to reinforce the existing figures, and the White Paper contains suggestions for carrying forward this work. It is a considerable task. This is the first step, and this problem, which has been found to be difficult by successive Governments, cannot be solved all at once. There are wide variations in the impact and level of unemployment not only between regions but between different parts of the same region. Therefore, the sampling must be carried out extremely carefully if it is not to cause confusion and is to be a fair and accurate method of reflecting the facts.

Mr. Milne

Is the Minister aware that the method he has outlined of compiling unemployment statistics merely tinkers with the problem, and that spreading the figures over a larger number of pages, sweeping them under the carpet and avoiding questions in the House is not the way to go about it?

The Minister mentioned the regions. What is he doing about migration from the areas of high unemployment, which is a means of cloaking the real impact? On the Minister's own assessment of social distress and the unemployment figures being used as an economic indicator, is he not again falling short of what the House requires? What we need from the Department is an indication of how soon unemployment will be tackled, and this is not the way to do it.

Mr. Macmillan

Unfortunately, perhaps, from the point of view of presentation, it is not the responsibility of my Department to create work. Its responsibility is to run the employment services and the statistics that go with them. All the information that the hon. Gentleman is seeking is available in the Department of Employment Gazette, where it is analysed in great detail. There are two difficulties. If one attempted to give this information in a Press notice, no one would print it because it would be too long and detailed. Secondly, the publication of the unemployment figures would be greatly delayed. I should like additional information to be given in the monthly Press notice, but it would mean a longer delay between the period to which the figures relate and the publication of the Press notice.

That is why I have decided that it is right to continue to publish the same basic figures presented slightly differently. I did not consult the House because the difference is so slight. We shall continue to use other methods and hope to publish periodic Press notices and analyses. To do that every month would delay matters, but if the information is given periodically it can be used by informed commentators to demonstrate and analyse trends more readily. The combination of producing the maximum amount of relevant information with the minimum delay and more detailed information slightly less speedily will provide the information which the hon. Gentleman is seeking.

Mr. Biffen

Is my right hon. Friend aware that the changing relationship be- tween the figure of unfilled vacancies and the statistics of the unemployed makes it clear that as an economic indicator the unemployment figures have become practically valueless in recent years? The latest reforms are extremely welcome on these benches as the first step in the process of producing a much more meaningful "Bradshaw" on unemployment. Will my right hon. Friend bear in mind that the true economic indicator we need is the number of unemployed who are genuinely seeking work?

Mr. Macmillan

I accept, as my hon. Friend says, that we are trying to produce a more meaningful "Bradshaw". The difficulty is to keep the timetable both updated and fully detailed—a problem which I am sure he appreciates.

On the question of those who are genuinely seeking work, the problem of using a statistical system to make subjective judgments is that it can be done only by a series of sample analyses. All I can do is to ensure that my officers try to place people in work, try to relate vacancies to people seeking employment and try to ensure that those who are registered as unemployed are willing to take jobs when they are offered to them. That is as far as we can go.

I accept that the relationship between vacancies and the unemployed as an economic indicator has changed enormously. Analysis is difficult. There are now far more vacancies in relation to the numbers unemployed than there have ever been. Therefore, the number of people on the register is not being diminished as rapidly as usual by the increase in the number of vacancies. I suggest that both employers and employees should use the employment exchanges. It is precisely to improve that use that my Department has instituted an employment services agency and is trying to modernise, update and improve all the premises and the services we give both to employers and workers.

Several Hon. Members rose—

Mr. Speaker

Order. This is a very important matter, but I must preserve the time of the House for its other business.

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