Sharp rise in unemployment in the UK

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Figures from the Office for National Statistics (ONS) have revealed that in the three months to August, unemployment in the UK soared by 164,000 to 1.79 million.

The rise marks the fastest for 17 years and many reports suggest that the number of people unemployed could hit the two million mark by Christmas. Capital Economics recently suggested that the figure could reach three million by the end of 2010.

Meanwhile, the ONS said the number of people claiming Jobseeker’s Allowance rose by 31,800 to 939,900 last month.

The figures suggest a slowdown as both the number of people in work and vacancies declined.

In response, the Government has plans for a A?100 million training programme initiative after Prime Minister Gordon Brown said the Government would do all it could to create work and help people retain their jobs during the economic slowdown.

Brendan Barber, general secretary of the TUC union body, described the unemployment figures as bad news, particularly as they do not show the impact of the recent banking turmoil.

John Philpot, of the Chartered Institute of Personnel and Development, said recruitment is slowing and redundancies are on the up and our surveys suggest the worst is not over yet.

The alarming figures came after it was unveiled that thousands of public sector workers are set to lose their jobs over the next two years.

A report in The Times revealed that nearly 10,000 jobs will go in the prison, probation and court services as the Ministry of Justice looks to save A?900 million.

Furthermore, should the Lloyds TSB takeover of HBOS proceed as planned, it is likely that thousands of staff will lose their jobs.

The news will no doubt put further pressure on the Bank of England to make another dramatic cut in interest rates after the 0.5% cut last Wednesday.

As redundancies increase, the focus is on families losing their homes due to unpaid mortgage repayments. Yesterday Bob Pannell of the Council of Mortgage Lenders said that repossessions could rise further next year due to the rise in unemployment.

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