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7 August 2023

The Spectre of Unemployment Haunting Wales

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Written by:

Victoria Winckler
The Bevan Foundation



It’s been quite a while since policy makers have worried about unemployment. But the latest unemployment figures suggest it is time to be concerned once again.

In the middle of July, the Office for National Statistics (ONS) revealed that one in twenty people of working age in Wales, some 74,000 people, were actively looking for work but did not have a job. That’s a third more people out of work than just a year ago, and extra 18,000 people in the dole queue. The unemployment rate is now at its highest in eight years.

At this stage it’s difficult to tell what’s behind the increase, partly because data on the wider economy lag behind the unemployment figures. But the swathe of recent plant closures must undoubtedly be a contributing factor. Indeed, the latest unemployment count comes before the closures – such as Zimmer Biomet (540 jobs lost), Avara Foods (around 400 jobs lost) andTillery Valley Foods (around 250 jobs lost) – take full effect.

The latest figures may be the start of an upward trend.

Unemployment casts a long shadow over those unfortunate enough to be out of work. It affects people’s physical and mental health, contributing to anxiety, depression, and low self-esteem. It affects household finances, sometimes causing a catastrophic drop in income, and family relationships. It blights the unemployed person’s future job prospects and earnings. And it even has a lasting impact on the children of unemployed parents, with under-5s being more likely to experience physical ill-health in adulthood while 6-10-year-olds are more likely to experience mental ill-health as they grow up.

Even a modest increase in unemployment, then, is something to be concerned about.

It’s not always easy for people to find a new job. People who have been with the same employer for years may never have had to prepare a CV or have a job interview. Jobs are now advertised online and via social media rather than on cards in windows. And the skills a worker has honed in one industry may not be transferrable to new types of work – production operative to barista or care worker is not a obvious career change.

Some help is at hand. The UK Government provides help for benefit claimants with work search and CV preparation via work coaches at Job Centre Plus offices. The Welsh Government’s Working Wales programme has a lighter touch, and offers a broad range of help from independent advice to help with the cost of vocational training and childcare, some of which is open to anyone.

Businesses have a part to play too.

One of the most important things employers can do is give an unemployed person a chance. All too often, employers discriminate against unemployed job applicants – one recruitment agency recently told me they would not submit the CVs of any unemployed applicant to an employer because they were usually ‘rubbish’.

Businesses can also help unemployed people change career by providing more training and induction opportunities for new recruits – at a time of dire recruitment problems it surely makes sense to create new pathways into a business.

The latest unemployment figures almost certainly reflect the labour market adjusting to changing circumstances: new patterns of global demand and opportunities, reduced consumer spending power and use of AI and robots. There is more change to come. Will we be able to avert a rise in joblessness?


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