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‘man-cession’ Recession Hits Private Sector Hardest

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‘Man-cession’ recession hits private sector hardest

It’s one of my busiest days of the month again – the regular trawl through the official labour market figures published by the Office for National Statistics. The latest set is the most eagerly awaited for a while, given that they appear amid mounting talk of economic “green shoots†and offer a picture of the first full year of the jobs recession.

Sadly, anyone looking for serious good news in today’s figures will have little to grasp at. The recorded quarterly fall in employment and rise in unemployment still ranks among the worst seen in the post-war era. Vacancies are drying up at a rapid rate and redundancies go on rising. The grim news thus continues, though this is not unexpected given the dire state of the economy at the turn of the year.

There is little in the figures to suggest that unemployment will not rise above 3 million next year. The one glimmer of hope is the claimant unemployment count (ie, people signing on for Jobseekers’ Allowance). Not only is the count increasing much more slowly than might be expected but, remarkably, the number of people flowing onto the count actually fell in May. If indicative of underlying economic factors – rather than the result of the way in which benefits are administered or a reduced propensity for unemployed people to sign on at job centres – these claimant figures are amazingly good given what we know about the state of the jobs market, though too puzzling to yet be seen as a genuine “green shootâ€.

As for the human impact of the first full year of the jobs recession, the stats are fairly horrible. In all, 0.4 million fewer people are in employment. The toll on the private sector has been horrendous – almost 0.7 million jobs have been lost. The public sector, by contrast, has added more than 0.25 million jobs (a 5 per cent increase) – much of it because employees of the RBS and Lloyds Banking groups are now being counted as part of the public- rather than private-sector workforce. Although, as the CIPD warned earlier this week, the public sector is likely to shed 0.35 million jobs in the next five years once government gets to grip with its massive budget deficit.

Overall, the burden of net job loss has fallen entirely on full-time employees. The total level of self-employment and part-time employment is broadly unchanged from a year ago. It has also generally been a “man-cessionâ€. The redundancy rate for men has more than doubled. The number of men in work has fallen by 2 per cent, the number of women in work by 0.6 per cent. The number of men unemployed has increased by 45 per cent, the number of women unemployed by a quarter. This pattern is mainly explained by the relative buoyancy of part-time employment and the growth in public-sector employment, types of employment in which women are strongly represented.

Young people aged under-25 have fared far worse than the over-50s, though the latter have seen relatively larger increases in unemployment because they have fewer education, training or employment options if they do lose their jobs.

The manufacturing sector has shed 0.2 million jobs – a 6.7 per cent decrease. The other big job-shedding sectors are distribution, hotels and restaurants and finance and business services. These sectors each shed 2.8 per cent of their workers. While this was a recession triggered in the finance sector, as in most previous recessions it is the real economy, and manufacturing in particular, that has suffered most. The amount of job losses in manufacturing is also noteworthy because this is the sector which has shown the greatest effort on the part of employers and workers to seek alternatives to redundancy, such as pay freezes, pay cuts and short-time working. Without such welcome action the impact of the recession on UK manufacturing employment might have been far greater still. So we can after all take some comfort from today’s jobs figures: things could be worse.

Keep your boss happy, and get out of debt, just in case.

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Keep your boss happy, and get out of debt, just in case.

Or make sure the spouse with the stable job has all the assets, the spouse with the shaky job has all the debt. If they get the boot, go bankrupt.

This needs to be planned for well in advance.

I think its a sensible financial strategy for life. e.g. Wife has house in her name, paid for in cash. Husband with higher income has any loans in his name, so this can never be secured on the house and the kids + equity are safe. In the event of a split, charges can be use to secure an interest in the property without having to own it (therefore an asset at risk).

VMR.

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Or make sure the spouse with the stable job has all the assets, the spouse with the shaky job has all the debt. If they get the boot, go bankrupt.

This needs to be planned for well in advance.

I think its a sensible financial strategy for life. e.g. Wife has house in her name, paid for in cash. Husband with higher income has any loans in his name, so this can never be secured on the house and the kids + equity are safe. In the event of a split, charges can be use to secure an interest in the property without having to own it (therefore an asset at risk).

VMR.

Are there any stable jobs? For me this recession will rip core employment apart.

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