With official labour market figures due to be published later this week likely to show that UK unemployment has risen above 2.5 million, the Chartered Institute of Personnel and Development (CIPD) publishes an assessment of the overall impact of the recession on the UK labour market and considers what might happen to jobs once the economy starts to recover.

The CIPD report: Jobs: The Impact of Recession and Prospects for Recovery concludes that:

• The percentage fall in employment during the recession has been less than a third as large as the percentage contraction in the economy. This represents a much lower ‘job distress ratio’ than suffered in the recessions of the 1980s and 1990s. Had previous UK experience been repeated it is likely that around half a million more jobs would have been lost.

• Compared with previous recessions the burden of labour market adjustment has been shared more evenly across the workforce in the form of reductions in incomes rather than falling mainly on jobs. A ‘shared pain recession’ of this kind demonstrates that, contrary to common perception, Britain’s flexible labour market is good for jobs and social well being.

• The biggest losers from the recession in employment terms have been men, full-time employees, people at both ends of the age spectrum, blue collar and unskilled workers, UK born workers, and private sector workers. The West Midlands, which is heavily dependent on the health of the manufacturing sector, has emerged as the UK’s main regional unemployment black-spot.

• From the autumn of 2009 onward the rise of unemployment toward a likely peak at above 3 million in 2010 will be more of a crawl than a rush. It is possible that policy initiatives such as the Youth Job Guarantee might even succeed in limiting the peak in measured unemployment to below 3 million.

Last update : 17-09-2009 08:43

Keywords : News, Select Category, CIPD assessment of employment impact of recession

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