Unemployment figures continue to drop

12/12/2007

The number of people claiming jobseekers’ allowance has fallen to a 32-year low, according to new data from the Office for National Statistics (ONS).

Figures fell by 11,100 to 813,000 in November, representing the lowest number of people claiming the unemployment benefit since June 1975.

Unemployment levels have also fallen by 15,000 over the last quarter and by 59,000 over the year, reaching 1.64m.

This could be partly due to an increase in job vacancies, the ONS figures suggested. In the three months leading up to November 2007 there were 680,700 jobs available. This figure is the highest since records began in 2001.

Analysts have commented that the results could ease inflationary pressures. Last week, the Bank of England cut interest rates from 5.75% to 5.5% amid fears of the impact of the US housing crisis and global credit crunch on the UK market and economy.

But Deutsche Bank's George Buckley, talking to the BBC, said that the fall in unemployment wouldn’t last for long.

“It’s an encouraging combination of lower unemployment and weaker earnings growth, but I'm not sure how long it can be sustained. A weaker jobs market next year looks likely,” he added.