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Unemployment surges as public sector job cuts hit home | Unemployment surges as public sector job cuts hit home |
(3 months later) | |
Article written by Richard Moss Political editor, North East & Cumbria | |
It seems likely that public sector job cuts have made a significant contribution to the last quarter's surge in unemployment in the North East. | It seems likely that public sector job cuts have made a significant contribution to the last quarter's surge in unemployment in the North East. |
The number of people out of work in the region rose by 18,000 in the last three months - a substantial contribution to the national increase of almost 80,000. | The number of people out of work in the region rose by 18,000 in the last three months - a substantial contribution to the national increase of almost 80,000. |
The stats do not make pretty reading. | The stats do not make pretty reading. |
The North East has the highest unemployment rate in the country with 10.7% out of work - edging ever closer to one in nine of the working age population. | The North East has the highest unemployment rate in the country with 10.7% out of work - edging ever closer to one in nine of the working age population. |
Economic inactivity | Economic inactivity |
Middlesbrough has the highest rate of unemployment of any local authority in the UK at 14.3%. | Middlesbrough has the highest rate of unemployment of any local authority in the UK at 14.3%. |
The region also has the lowest employment rate in the country - 65.9% - with the rate falling significantly in the past year. | The region also has the lowest employment rate in the country - 65.9% - with the rate falling significantly in the past year. |
And the North East also has the highest economic inactivity rate with one in four people not contributing to the economy. | And the North East also has the highest economic inactivity rate with one in four people not contributing to the economy. |
It is impossible to be categorical about what factors might have contributed to last quarter's rise in unemployment. | It is impossible to be categorical about what factors might have contributed to last quarter's rise in unemployment. |
But government figures do suggest that there has been a big reduction in public sector employment. | But government figures do suggest that there has been a big reduction in public sector employment. |
The number of people employed in the UK's public sector has fallen by around 110,000 in the last three months. | The number of people employed in the UK's public sector has fallen by around 110,000 in the last three months. |
It's the biggest decline in public sector jobs since records began in 1999, and evidence that government cuts are biting. | It's the biggest decline in public sector jobs since records began in 1999, and evidence that government cuts are biting. |
Urgent action | Urgent action |
And given the North East's dependence on the public sector, it would be surprising if this quarter's extra jobless people didn't include a number who used to work for councils and government departments and agencies. | And given the North East's dependence on the public sector, it would be surprising if this quarter's extra jobless people didn't include a number who used to work for councils and government departments and agencies. |
It also seems to include many women too, who were often employed in the public sector, as well as more than one in five young people. | It also seems to include many women too, who were often employed in the public sector, as well as more than one in five young people. |
Kevin Rowan, from the Northern TUC, said: "The cuts are hurting but not working - at all. They are simply bleeding the life out of the North East economy and we need urgent, remedial action to stem the flow and save us from a bleak future." | Kevin Rowan, from the Northern TUC, said: "The cuts are hurting but not working - at all. They are simply bleeding the life out of the North East economy and we need urgent, remedial action to stem the flow and save us from a bleak future." |
Of course, the government always knew that there would be a significant fall in public sector employment. | Of course, the government always knew that there would be a significant fall in public sector employment. |
But the worry is that so far the private sector isn't generating enough extra jobs to take up the slack. | But the worry is that so far the private sector isn't generating enough extra jobs to take up the slack. |
There was always a danger that there would be a significant time lag between the loss of public sector jobs, and the creation of private sector replacements. | There was always a danger that there would be a significant time lag between the loss of public sector jobs, and the creation of private sector replacements. |
Chancellor's strategy | Chancellor's strategy |
The government will be hoping that lag isn't too long. | The government will be hoping that lag isn't too long. |
There is always the danger that increased unemployment could depress the private sector too. | There is always the danger that increased unemployment could depress the private sector too. |
With the international economic situation fragile to say the least, the Chancellor's current strategy is under pressure. | With the international economic situation fragile to say the least, the Chancellor's current strategy is under pressure. |
The government though says that Labour must bear the brunt of the blame for overspending when it was in office. | The government though says that Labour must bear the brunt of the blame for overspending when it was in office. |
It says the economic situation would be even worse if it hadn't cut spending back. | It says the economic situation would be even worse if it hadn't cut spending back. |
But whoever's to blame, the North East's unemployment problem is certainly growing. | But whoever's to blame, the North East's unemployment problem is certainly growing. |
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