Unemployment: Statistics (Hansard, 17 January 1991)

§ The Parliamentary Under-Secretary of State, Department of Employment (Viscount Ullswater)
My Lords, in the month to December seasonally adjusted unemployment in the United Kingdom increased by 80,400 to 6.5 per cent. of the workforce. Unemployment has been increasing in the United Kingdom since March 1990.

§ Lord Donoughue
My Lords, I thank the Minister for those sad statistics. Is he aware that that latest monthly increase is the fifth worst in the history of recorded unemployment? Bearing in mind that unemployment has been rising for nearly a year and is forecast to rise over the coming year to around 2.5 million, will he inform the House whether that policy of unemployment is in fact an incomes policy in disguise? If so, does he agree that it would be better to have an honest incomes policy, more fairly shared, in which the burden did not fall mainly on the unemployed?

§ Viscount Ullswater
My Lords, I cannot agree with the noble Lord's reading of the scenario. The figures must be seen in context. They do not detract from the Government's longer-term achievements in improving the performance of the labour market leading to increased employment, which is at a record level. The United Kingdom has one of the lowest rates of unemployment in the European Community.

§ Lord Barnett
My Lords, would it not be more honest of the Government to concede that no government can solve the problems of unemployment in this country while our relative unit wage costs are so much out of line with those of other countries in the European Community, whether or not we are in the exchange rate mechanism? Can he tell the House what plans the Government have to deal with that problem?

§ Viscount Ullswater
My Lords, I have a certain sympathy with what the noble Lord said. It is important that wage increases should be contained. Having said that, we have one of the lowest unemployment rates in the European Community. Unemployment is rising in most major industrialised countries, including the USA, Japan, Canada, Italy and France and, in the USA and Canada for instance, at a much steeper rate than in this country.

Lord Bruce of Donington
My Lords, is the Minister aware that my noble friend's Question is directed to figures relating to the unemployed? The figures given by the noble Viscount and provided by his department relate to people unemployed and in receipt of benefit. Is the Minister further aware that the working party set up under the auspices of the Bank of England reported that an additional 600,000 people are unemployed and ineligible for benefit? Therefore, the total number of people now unemployed—that is, in the real sense as distinct from the fiddled qualifications imposed by the Government—is almost 2.5 million.

§ Viscount Ullswater
My Lords, it is more useful to the House and to the country at large if the figures are consistent month to month. The seasonally adjusted unemployment series of figures gives a comparable assessment of trends over time.

§ Lord Dean of Beswick
My Lords, how many of the 80,000-plus people referred to by the Minister are from the manufacturing sector? Is it not the case that one of the most sinister aspects of the increase in unemployment is the continued reduction of our manufacturing base which is vital to our economic success?

§ Viscount Ullswater
My Lords, the number that the noble Lord seeks is 13,000. Of course, the number employed in manufacturing industries is higher than in June 1987. During the past three years manufacturing output has grown faster than GDP, although I must confess that we are expecting slower growth during the next couple of years.

§ Lord Molloy
My Lords, is the Minister aware that the figures and comparisons that he has given bring no succour or comfort to the British people who are unemployed? Is he further aware that many of the long-term unemployed are skilled craftsmen? With a little training their knowledge and skills might be suitable for other industries. Would it not be worthwhile for the Government to examine the proposition of using in other industries some of the skilled, long-term unemployed who are of great value to our nation?

§ Viscount Ullswater
My Lords, as regards the flow of people in and out of unemployment, many unemployed skilled people find work quickly. Approximately 300,000 per month leave the count. More than 25 per cent. of unemployed people leave within the first month and 56 per cent. leave within the first three months. It is a dynamic economy.

§ Baroness Turner of Camden
My Lords, does the Minister agree that there is a disappointing growth in unemployment in the South East as well as in the manufacturing sector to which my noble friend 1252 referred? What are the Government doing specifically about that problem? Many people in the South East have been persuaded to buy their own houses but with the growth of unemployment they will have great difficulty in retaining them. What specifically do the Government intend to do about that new area of unemployment?

§ Viscount Ullswater
My Lords, it is a fact that the regional pattern of the latest figures shows a larger increase in the South East than, for instance, in the North. However, I must remind the noble Baroness that during the past year the unemployment service has helped more than 1.5 million people to find work. In April last year my right honourable friend the Secretary of State announced a five-point job help package which is now in place.

§ Lord Dormand of Easington
My Lords, is it not now crystal clear that the main cause of rapidly increasing unemployment is high interest rates? As the Minister has said, unemployment has been increasing since March of last year. Is it not now manifest that the Government's single weapon of high interest rates is failing? Are the Government so bankrupt of ideas that they fail to take into consideration any of the many suggestions put forward from this side of the House?

§ Viscount Ullswater
My Lords, no; of course they take into consideration many ideas both from the opposite side of the House and from outside. That does not necessarily mean that those ideas are correct. The Government are, of course, committed to a substantial reduction in inflation during 1990–91 and they are working towards that.