Unemployment has fallen significantly in the North East, with the number of people claiming out-of-work benefits finally falling below pre-pandemic levels.
New figures from the Office for National Statistics (ONS) show the region’s headline unemployment rate falling 0.4% to 5.0% in the three months to the end of March, and the number of people on benefits fell below 75,000 for the first time in more than two years.
But the North East’s unemployment remained the highest in the country and well above the national average of 3.7%, while the number of people in the region classed as economically inactive was above 25%. Nationally, the ONS said the figures showed a “mixed picture”, with unemployment falling to its lowest level since 1974 but earnings in most sectors of the economy failing to keep pace with rising inflation.
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North East LEP chief executive Helen Golightly said the figures showed a 'conundrum' for firms in the region.
She said: “We have a continuing and distinctive challenge with North East unemployment and working age economic inactivity rates both being the highest in the nine English regions. The latter measures people who are not in work or actively seeking employment.
“Yet, employers in some of our key sectors like transport, digital and construction are struggling to find people with the right skills.
“This is a crucial and urgent conundrum for us to solve. As we face a future of higher living costs, a clear focus on helping people to secure higher paid and skilled employment will be good for our residents, build business confidence and be good for the region's economy.”
Arlen Pettitt, knowledge development manager, North East England Chamber of Commerce said: “There are some signs of improvement from the first three months of this year, as employment increased and unemployment fell, but we still have a gap to the rest of the country.
“The national picture may show unemployment at the lowest levels since 1974, but the North East story is different, with the highest unemployment rate, lowest employment rate and highest economic inactivity rate in England. Closing the gap to the national averages will be one of the key measures of the Government’s levelling up agenda.
“Businesses are telling us that costs are their main concern – inflation, energy, taxation, and pressure the cost of living is putting on staff pay. There was nothing in last week’s Queen’s Speech which addressed the urgency of these issues, and we need to see the Government’s act quickly to make sure the tentative improvement we’ve seen continues through the rest of 2022.”
Nationally Britain's jobless rate has fallen to its lowest level for nearly 48 years, but workers have seen their pay fall further behind rocketing inflation.
For the first time, there were fewer unemployed people than job vacancies, although the fall in the rate was also due to a rise in the number of people dropping out of the jobs market.
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