Mixed unemployment signals but overall looking better

The number of people that claimed benefits for being jobless dropped by much more than was predicted during May, falling to the lowest rate seen in over a year.  However, at the same time data shows that the larger measure of unemployment has continued to rise.

The Office for National Statistics stated that number of people that claimed unemployment decreased by 30,900 in May against predictions of 20,000.  April’s fall was also revised in order to show a larger fall of 32,000, which is bigger than originally reported.

At the same time, the number of unemployed according to the wider ILO measure increased by 23,000 over the three months preceding April up to 2.472m. Overall this increased the jobless rate up to 7.9%.

Against the figures released by the Office for National Statistics, the pound increased by a fifth of a cent compared to the dollar which reinforced analyst’s hopes that the recovery is starting to gain pace.

Economist at Monument Securities, Stephen Lewis, stated that the figures continue to support the elevated trends that they have seen over the last few months and the ILO measure is starting to finally level out.

In the last few months, the ILO measures and claimant count have sharply diverged, but the ONS states that they are a different measure of figures and should not be compared about each other.

Regardless, unemployment has not increase as far as most believed it would after the recession which was the worst the UK has seen since WWII.