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By Peter Hoskin
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A shrinking economy, rising inflation, no more Olympics — but what's this? Today's employment figures contain some good news. The number of people in employment rose by 201,000 to 29.4 million in the three months to June, the highest level since March-May 2008. The unemployment rate dropped to 8 per cent. The number of people claming Jobseekers' Allowance fell by 5,900 in July, to 1.59 million. On the surface, it's a parade of positive developements.

But what about below the surface? Well, there are some encouraging signs there, too — most notably that that persistent bane, youth unempoyment, fell by 4,000 across the same three months. And many of the jobs have been going to UK nationals, which has not always been the case. The number of UK nationals in work is up by 246,000 on a year earlier. For non-UK nationals it's 15,000.


This is not to say we should be jubliant. The number of people in employment is still 96,000 lower than that 2008 peak. Youth unemployment is still over 1 million. And it remains true that a good portion of the gains are accounted for by rises in part-time employment. The number of people who want to work full-time but are having to work part-time — a much more telling figure than just the number of people working part-time — is up by 16,000 on the previous quarter to 1.42 million, the highest since comparable figures began in 1992. Still, I doubt ministers will be unduly concerned while most of the trends are going in the right direction. And, besides, part-time work can be a stepping stone to a full-time job.

The question now is how all this can be achieved during a recession. That employees are more willing to compromise might be part of it — whether it's with fewer hours or lower pay (wage growth has only been 1.6 per cent over the past year, well below inflation) — but it's still a strange one. And it will leave the government hoping that this is a horse to finally drag our broken cart of an economy along.

10.45 update: Iain Duncan Smith has commented:

"It’s not just over the last few months, the last couple of quarters, you take it from 2010 the private sector has created nigh on a million new job against a backdrop of difficulty."

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