British unemployment hit its highest rate since 1996 in the three months to June, official figures showed yesterday, while the number of people claiming jobless benefits rose broadly as expected last month.
The Office for National Statistics (ONS) said the ILO jobless rate rose to 7.8 percent in April-to-June, above forecasts for a rise to 7.7 percent and the highest since October-to-December 1996.
The number of people without a job on this measure rose to 2.435 million, its highest since 1995.
Many analysts reckon the jobless total will hit three million, bad timing for British Prime Minister Gordon Brown’s Labour government which faces an election next year.
“There doesn’t seem to be much sign that the rate of increase [in unemployment] is slowing down,” said Stephen Lewis, chief economist at Monument Securities.
The ONS said the number of people claiming unemployment benefit rose by 24,900 last month, broadly in line with forecasts for a rise of 25,000 and after a downwardly revised increase of 21,500 in June.
That took the jobless rate on this measure up to 4.9 percent, the highest since October 1997.
The claimant count and broader ILO measures of unemployment have shown wide disparity in recent months and analysts say the former may not capture the full scale of recent layoffs.
The government has launched an investigation into this discrepancy.
One possible cause could be that some people who have recently lost their jobs are relying on their partner’s income, their own savings or redundancy payments.
Yesterday’s figures showed employment fell by 271,000 in April-to-June, matching the decline in February-to-April, which was the biggest since records began in 1971.
“The ILO figures suggest that the deterioration in the labor market is yet to show signs of stabilization,” James Knightley at ING Financial Markets said.
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