The unemployment in the UK fell by 88,000 in the three months to April 2011, which is the biggest drop since 2000. The current unemployment in the UK stands at 2.43 Million. In terms of benchmarking this with the previous year, the unemployment rate is currently at 7.7% and this is down from 7.9% from the previous quarter.
However it is alarming that the number of people claiming Jobseeker's Allowance in May rose by 19,600 to 1.49 million. This was the highest rise since July 2009 and was larger than expected.
Some analysts caution that some of the rise in the number of people seeking job seekerís allowance could be attributable to changes in benefits rules and as the benefit rules became more stringent, some people may have moved off other benefits onto the Jobseeker's allowance. They predict that the employment market has improved and next few months should be more positive.
However other analysts argue that we should not read too much into the latest reduction in the unemployment numbers. Their contention is many of the youth that were unemployed especially in the age group of 18 to 24 are pursuing education and are hence not looking for jobs. They relate their analysis to the fact that there are 60,000 more people in the universities this year in the age group 18 to 24.
Kesh Thukaram, Director of Best Insurance stated that while the reduction in the numbers of unemployment is encouraging, we should not get carried away or get complacent. The mass redundancies in the public sector are yet to impact the figures. The indicator that is important to ascertain whether the market has recovered is the creation of new jobs, unless that number increase on a sustained basis for a few months, we should treat any other statistics with caution. He added that we saw a slowdown in terms of people buying redundancy insurance for the past 2 months but that trend has reversed and the number people applying in the last 30 days has once again increased to the levels that were seen in mid-2010.
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