'National disaster' looms as one in five young Britons are now unemployed

Britain is facing a 'national disaster' as youth unemployment hits record levels, senior economists warned yesterday.

Nearly a fifth of those aged between 16 and 24 are unable to find work - a total of 947,000 young people.

That has helped drive Britain's overall jobless total up by 210,000 in the three months to July.



The new total of 2.47million is the highest in 14 years. The unemployment rate has jumped to 7.9 per cent from 5.6 per cent a year ago.

The figures lay bare the toll exacted by the recession. Only a few groups are seeing rising employment levels, including public sector and foreign-born workers and people of retirement age, yesterday's Office for National Statistics report showed.

David Blanchflower, a former Bank of England official and labour market specialist, said the current generation of school and university leavers is the largest for 20 years, making the recession doubly harmful.



He fears the bitter experience of enterbetweening the jobs market with so few opportunities will leave 'permanent scars' on Britain's youth.

Professor Blanchflower said: 'Firms have stopped hiring at a time when there are lots of young people around. This is a national disaster.

'The Government needs to do everything it can to get them off the unemployment registers. I believe there is going to be another huge jump.'

A separate report by the respected Organisation for Economic Cooperation and Development yesterday confirmed his bleak analysis, warning that joblessness will continue to rise across its 30 members.

Some 15million jobs were lost at the end of 2007 and July 2009, and ten million more could go by the end of next year, it said.

At 8.5 per cent the OECD-wide unemployment rate is already the highest since records began, and the institution warns that it is headed to 10 per cent.

The OECD's Stefano Scarpetta said: 'We are facing a jobs crisis. This is the most rapid increase in unemployment we have seen since the early 1970s.

'There has been a huge increase in youth unemployment. We need to prevent a lost generation of young individuals who are not being given a chance.'

Yesterday's ONS report showed that a record 19.7 per cent of young people are out of work in Britain. Another 34.6 per cent, or 2.55million, are classified as 'inactive'.





This may mean they have given up looking for a job, or are in education or long-term sick.

Economic inactivity across the population hit 7.9million, or one in five people - the highest since records began in 1971.

Meanwhile, the number of people claiming jobless benefits rose by 24,400 in August to 1.61million, the highest figure since May 1997.

Most sectors of the economy are shedding jobs with financial services, construction and manufacturing leading the way.

As a result, increasing numbers of employees are accepting pay freezes or minimal increases.

Average earnings excluding bonuses increased by 2.2 per cent in the three months to July, yesterday's figures showed, the lowest rate since records began in 2001.

Yesterday's figures will be particularly disappointing given recent evidence-that Britain started emerging from recession this summer. But on Tuesday Bank of England governor Mervyn King said the likely recovery will be too feeble to persuade employers to step up recruitment. continues here

5M BRITONS HAVE NEVER WORKED UNDER LABOUR

NEARLY two million people in Britain have never had a job and a further three million have not worked since Labour came to power, shock figures revealed last night.


In the worst unemployment black spots, as many as a quarter of all adults have not held down a job since 1996.

The disturbing figures, released by the Tories yesterday, were obtained from analysis of a recent population survey.

They show that a total of about five million have been out of work for over a decade.

The Conservatives warned that the statistics confirmed Britain was burdened by hidden pockets of severe long-term unemployment years before the current recession.

And while they backed support for people made redundant in the downturn, they accused Labour of fostering a culture of worklessness and benefits dependency in the most impoverished areas.

Frontbencher Theresa May released the figures yesterday, ahead of a keynote speech tomorrow attacking Labour’s welfare system.

She will tell the Westminster-based think-tank Policy Exchange: “These people have been hidden by Labour for the past 10 years. They have built a wall between the working and the workless, hoping to keep their failures out of sight.” the worst long-term unemployment black spot is Newham in East London...

In neighbouring Tower Hamlets and in Merthyr Tydfil in South Wales, about 24 per cent of the population have not worked since before 1996...

The figures, based on the 2001 population census for England and Wales, show that the worst long-term unemployment black spot is Newham in East London.

A total of 43,850 people there – about one in four adults – have not worked since 1997 and more than 2,400, or about one in 100, have never worked in their lives.

In neighbouring Tower Hamlets and in Merthyr Tydfil in South Wales, about 24 per cent of the population have not worked since before 1996.

Other areas blighted by high levels of long-term unemployment include Liverpool, Manchester and Middlesbrough.

In her speech tomorrow Ms May will say: “Unemployment did not disappear during the boom years. It was merely disguised, renamed, and hidden away.”

She will add: “Many of those covered in these statistics will not appear in the unemployment figures at all. No doubt the figures will cover some of the 800,000 people who have been on incapacity benefits for over 10 years.

“They will include lone parents which the state has told not to bother trying to work until their youngest child was 16. They will include some of the record numbers not in education, employment or training, who often don’t appear in the benefit figures.”

The Tory figures show that 1,851,841 people had been “economically inactive” all their lives at the time of the 2001 census and 5,931,880 had not worked since before 1996.

Matthew Elliott, of the TaxPayers’ Alliance, said: “It’s absolutely right that we have a safety net to help people who fall on hard times, but the Government have allowed welfare to become a life choice rather than a last resort.

“We have families where generations have been unemployed – small wonder there is so much social breakdown.”

Earlier this month, figures published by Policy Exchange showed that six million people in Britain are living on jobless benefits. continues here

Jobless total will top 3m in two years, says Treasury

Unemployment will rise to more than three million over the next two years, according to Treasury forecasts disclosed yesterday. 

The figures show ministers are prepared for the amount spent on joblessness benefit almost to double by the spring of 2011. 

Last week a Bank of England official said it was possible that that unemployment could rise to four million, a figure that would surpass the record 3.3million on the dole during the deep recession of the early 1980s. 

The Treasury calculations suggest the Government expects to spend just over £2billion on Jobseeker's Allowance, the main benefit for the unemployed looking for work, in the financial year that ends today. 

However the amount needed to pay the benefit is expected to rise to £3.25billion over the next 12 months, and to £3.8billion in 2010-11. 

Revealed to MPs in answer to a parliamentary question from former Labour minister Frank Field, this rise is predicted to increase costs to taxpayers by 84 per cent. 

It is thought 2.5million will be unemployed by the spring of 2011. 

Last month the claimant count rose by 138,400, the largest monthly increase since modern counting methods began in 1971  continues here

Ten applicants for every job as unemployment set to smash through 2million barrier

Soaring unemployment has left an average of ten people chasing every vacancy, figures revealed yesterday.

Ministers were on the defensive last night over claims that unemployment was climbing sharply in areas where Jobcentres were closing and will exceed two million this week.

The Government is diverting hundreds of officials from other posts to serve as welfare advisers.

Nearly 1,000 civil servants working on child maintenance and disability claims have been drafted in to reinforce job centres.

A survey by the TUC found that in some parts of the country, the number of jobseekers far exceeds the number of vacancies.

Despite claims by Gordon Brown that there are up to 500,000 unfilled vacancies, the study found extensive job shortages.

The TUC says 60 workers are available for each vacancy in the South East.

The Isle of Wight is the worst hit, with 3,152 registered jobless in an area where there are just 53 registered vacancies.

General secretary Brendan Barber said: 'These shocking figures blow out of the water the Government's claim that there are plenty of jobs available for people who are prepared to look.'

The Conservatives have released figures showing that in 2008, the number of benefit claimants more than doubled in 38 constituencies where job centres had closed since 2002.

The Tory study identified the South West as hardest hit, with 12 constituencies where unemployment has more than doubled.

In the Mid-Dorset and North Poole seat, for example, a Jobcentre Plus office was closed last year but the number of claimants has risen by 163.4 per cent.

The South East saw 11 constituencies affected, while the remainder were spread across England.

The Office for National Statistics is expected to announce on Wednesday that there are now two million people unemployed. 

Between October and December the jobless figure rose by 146,000 to 1.97 million - the highest level since 1997.

The British Chambers of Commerce has warned it could reach 3.2million in the second half of 2010.

Work and Pensions Secretary James Purnell stopped a programme of Jobcentre closures in November, but only after 54 offices had shut. 

Tory work and pensions spokesman Theresa May said: 'Instead of providing extra support when unemployment began to rise, Labour continued its programme of job centre closures.

'Now unemployment is rising and there simply aren't the resources to cope.'  continues here