The North East’s unemployment rate has fallen slightly but there has been a big rise in the number of people opting out of the world of work altogether, new figures show.
The region’s headline unemployment fell slightly to 4.5% between October and December, meaning the North East still had the highest rate of joblessness in the UK, although it now held that unwanted position jointly with London. The national rate of unemployment stayed unchanged at 3.7%.
But there was a big rise in the number of people classed as ‘economically inactive’, which rose to 25.7%, the highest figure seen in the region in more than four years. Taken together, that meant the North East has by far the lowest proportion of working age people in jobs at 71%.
Read more: construction giant Tolent goes into administration
Figures from the Office for National Statistics showed that there was still a big gap between pay rises in the public and private sectors, and that pay in general continues to be outstripped by rising prices.”
Chancellor Jeremy Hunt said: “In tough times unemployment remaining close to record lows is an encouraging sign of resilience in our labour market. The best thing we can do to make people’s wages go further is stick to our plan to halve inflation this year.”
But Shadow Chancellor Rachel Reeves said: “Real wages have fallen again. Britain has huge potential – but 13 years of the Tories has left families worse off and our economy lagging behind. Labour’s real plan for growth will create good, new jobs across our country.”
The latest figures will not include the 350 job losses announced this week after long-established North East firms Tolent and Traidcraft went into administration. Killingworth construction firm Metnor has also filed notice of going into administration, though the number of jobs lost there is not clear as yet.
Insolvency experts have warned that rising prices, the continuing cost-of-living crisis and the ending of some Government pandemic-related schemes on protection from insolvency will push many businesses over the edge in the coming months.
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