Unemployment in Worcestershire dropped slightly last
month on the claimant count – by 121 to 10,317.
This was not sufficient to change the percentage unemployed since last
month, which still stands at 3.0% on the ONS method of calculation, though it
is a 0.2% fall on 12 months ago. Most of
the detail figures are similar to previous months so I don’t propose to repeat
them, except to say that, in line with recent national trends, youth
unemployment has been falling for a few months and now stands at 14% in the
worst affected wards compared with approaching 20% some time back. This is also having the effect of bringing
some areas not previously in the top ten list into the picture. For more detail on this (see p.22) and other
figures go to the County Economic Summary.
Long-term unemployment last month decreased by 1.2 % to
37.6% for those claiming benefits for more than six months and by 0.3% to 22.5%
for those claiming over 12 months. This
is against a national trend where the headline rates in this area have
increased. More detail on the national
figures can be found here.
National Picture
What I felt to be a helpful analysis of the current
national position was offered by Gerwyn Davies, the Chartered Institute of Personnel
and Development labour market adviser, who said:
“Employers have continued to focus on keeping labour
costs down and a combination of pay restraint and a higher proportion of
part-time and temporary work has enabled them to take on more staff.
“Of particular note this month is the disproportionately large increase in part-time employment. Almost half of the employment increase is due to part-time employment, and almost all of this increase is accounted for by women.
“Of particular note this month is the disproportionately large increase in part-time employment. Almost half of the employment increase is due to part-time employment, and almost all of this increase is accounted for by women.
“Despite the positive headline figures, the high proportions of part-time and temporary work suggest that many employers remain cautious about adding to their long-term cost base. Business confidence has improved in recent months but is still fragile.
"So while we may see further short-term increases in employment - as indicated in CIPD’s Labour Market Outlook – it may be some time before this translates into the permanent positions that most job-seekers prefer.”
Economic Outlook
I want to use the rest of this piece to focus on the
economic outlook. Mervyn King’s widely
reported views about the long and winding road with regard to the national
outlook can be found here. However, I now
receive the Hereford and Worcester Chamber of Commerce quarterly economic briefing
and so I will try to summarise what that says about business prospects more
locally. You
can read the full document here.
Whilst the National trend shows that the economy is 'stagnant' and growth is 'weak', the third quarter of 2012 results locally show 'stability' and more positive results for the manufacturing sector.
Nationally, orders fell but locally there has been a small increase in orders, especially in manufacturing, though service sector orders decreased. The local domestic sales 'balance' (i.e. those firms reporting an increase in sales compared with those reporting a decrease) is the same as the last quarter, although the increase in domestic sales is slightly lower than last quarter and both manufacturing and service sectors show a drop in sales.
Whilst exports have weakened nationally, the figures are more promising locally, with an increase in export sales for manufacturing although a decrease within the service sector. The overall local ‘balance’ for exports has increased.
Nationally firms are less confident in taking on staff but locally there has been more confidence. There has been an increase in workforce and attempts to recruit with an increase in full-time and permanent positions which is encouraging.
Investment in plant and machinery remains very low in both the service and manufacturing sectors with investment remaining unchanged, however, investment in training has increased, which is encouraging.
Business confidence continues to show 'uncertainty' and is lower than the last quarter with both turnover and profitability lower. However, there is a slight improvement in businesses operating at full capacity but there is uncertainty within manufacturing with a high percentage operating below full capacity.
Pressure to raise prices has dropped with both manufacturing and service sectors expecting prices to remain unchanged. Businesses locally are concerned about competition, inflation and corporation tax. Nationally, inflation remains a concern for businesses in both sectors.
Conclusion
Whilst this is very much a summary of what are quite complex figures (essentially firms are asked about a range of figures and their views and expectations and whether they are more confident less confident or feel the same) it would appear that locally across Hereford and Worcestershire that the picture is slightly more encouraging than the national situation. This would correlate with our better than both national and regional figures for unemployment. It would also be consistent with our having less ‘old’ manufacturing than other parts of the West Midlands, which is suffering more both long-term and in this recession. However, whilst Worcestershire is holding its own on figures such as Gross Value Added with Herefordshire and Staffordshire, it is some way behind other shire neighbours such as Gloucestershire and Warwickshire and there are concerns about our ability to keep up.
I have been doing some supporting work for a project called ‘Next Generation Worcestershire’, which raises some serious questions about the need for continuing to increase prosperity and for what purpose. It will hopefully be published shortly for debate amongst ‘leaders’ in the County. If it is possible, it would be important for church people/’leaders’ to be able to respond to the questions it raises.
