UK jobless rate rises to 17-year high

labour market deterioration.
The figures released yesterday heap pressure on Prime Minister David Cameron to do more to boost an economy at risk of sliding back into recession as Europe’s worsening debt crisis convulses financial markets.
The Bank of England also cut its growth forecasts, and warned output was likely to remain flat until the middle of next year.
Unemployment among 16 to 24 year-olds in the UK rose to just over one million – 21,9 percent of the economically active population in that age group – in the three months to September.
The total unemployment and the rate of youth unemployment were the highest since comparable records began in 1992, although the Office for National Statistics said earlier data showed higher levels in the mid-1980s.
Overall unemployment rose to 2,6 million, the highest since 1994 and a larger rise than economists had expected. It was the fastest UK increase since mid-2009.
The unemployment rate rose by 0,4 points to 8,3 percent of the workforce, the highest since 1996.
The market had expected 8,2 percent.
“These figures show just how much our economy is being affected by the crisis in the eurozone.
“Our European partners must take urgent action to stabilise the position,” said Chris Grayling, the employment minister.
“Our challenge . . . will be to put in place additional measures to support growth and create employment opportunities, especially for young people.”
Economists expect UK unemployment to continue rising over the northern winter, with predictions of the likely peak next year ranging from 2,6-million to more than three million.
“The unemployment number ticking up so much is quitedramatic and an 8,3 percent unemployment rate is punchy,” Peter Dixon, an economist at Commerzbank in London, said yesterday.
“People are finding that it’s grim. It’s tough to find a job.”
Matthew Freeman, manager of skills and young people at Working Links, an organisation that helps to get people back to work, yesterday said youth unemployment in the UK had reached crisis levels.
“With over a million young people out of work, we risk creating a lost generation of young Britons,” he said.
The UK government will pay small companies a £1 500 incentive to take on apprentices, Business Secretary Vince Cable announced yesterday.
Bank of England governor Mervyn King said the increase in unemployment was unsurprising given the deterioration in economic prospects since August.
“It’s for the government to respond to that and we will do our part to restore macroeconomic stability,” he said yesterday. – Financial Times/Bloomberg.