Unemployment and possible strategies to cease it has been the matter of heated debate during the recent years, while its rates growing rapidly, due to the global financial crisis of 2008. Losing a job is likely to be one of the most distressing events occurring in the overall economy and in an individual`s life. This change has a significant and negative effect on economics, as well as the psychologies of the unemployed people.
Some economists consider United Kingdom to be one of the European most successful examples of fighting with unemployment. In 1993-2002 the unemployment rates have significantly decreased from 10.3 to 5.1 percent. Like in most of the European countries, these rates have skyrocketed up to 8 percent in 2009, leaving more than 2.5 million people without job. This recession has slowed down only in 2010 and since then has experienced a series of minor ups and downs. The most recent data of the Office for National Statistics1 claim that by 16 October 2013 the unemployment rate has dropped to 7.7 percent if compared to 7.8 percent of the previous quarter. Today the number of both full-time and part-time employed people has increased by 155.000 and reached a record high of 29.87 million in the quarter.
Taking into account unemployment rates that are still pretty high, the labor force is significantly weakening its bargaining power, which results in employees being more willing to accept non-standard employment conditions and contracts. They tend to agree to greater intensity and duration of work, such as functional and overtime flexibility, as well as working part-time. This is confirmed with the data represented by the Office of National Statistics 1, claiming that many of 1.5 million part-time employed people were not able to find full-time jobs. This is the highest rate since 1992. Part-time jobs, however, are in a different proposition for men and women. These are an important element in the female labor market, accounting for about 30 percent of the total employment. This proportion remained fairly constant during the recent employment cycles. This explains why women are searching and finding part-time work more often than men. Employers are happy to use part-time jobs for reasons like smoothing fluctuations, or getting around labor restrictions. However, in 2013 the number of women in part-time work has decreased by 13,000. Part-time jobs for men account for a significantly smaller fraction of employment, having increased by 21,000.
The rates of the youth unemployment have always remained much higher than those of the older population. This can be explained by several factors. The first is the lack of qualifications in younger job-seekers. Young men and women without any skills have much more chances to be unemployed due to the lack of experience and knowledge, while recent school leavers may require some time to find job. Other factors include cyclical unemployment, frictional unemployment, as well as cultural and social aspects of job-seekers. A lack of previous employment may cause companies to be unwilling to hire young people in the first place. Being consistently high in the past, today , the rates of youth unemployment has dropped down by 1,000 over the quarter, remaining just below the one-million mark and counting around 958,000 unemployed young people1.
The long-term unemployment has been steadily increasing over the past five years. This is pretty logical: as unemployment grows there is a danger that after a long period of time some people will still fail to find a job. The Long-term unemployment has almost doubled during 2008-20112. However, today we witness a decrease in the number of the long-term job seekers, which having dropped by 15,000, now constitutes 900.000.
Birmingham Ladywood has traditionally been one of the most deprived parts of the UK, having the highest levels of unemployment. Two-thirds of Ladywood`s population belong to the ethnic and racial minorities, which puts them into the risk group for unemployment. Young black men are the category of population most subjected to unemployment, according to the data provided by the Office for National Statistics1.
Fortunately the economy of the UK is currently showing signs of strengthening, while improving the indexes of construction, services and manufacturing. Average earnings growth accelerated by 0,8 percent compared to August 2013, partly showing the results of the delayed bonus payments, as employees sought to take advantage of the April`s top rate of income tax. Excluding payments of the bonuses, annual earnings growth has increased to 1.1 percent from 1 percent.
With its 7.7 percent, today, the UK unemployment rate is below the European Union average. This may not look too serious if compared to those of the Mediterranean states, however, it is still far from perfect.
- Office for National Statistics. Labor Market Statistics, October 2013. Retrieved from http://www.ons.gov.uk/ons/rel/lms/labour-market-statistics/october-2013/index.html. Updated 16 October 2013. Accessed 6 November 2013