UK unemployment continues to rise

Unemployment in the UK is now at its highest level since 1997 and coupled with the fact that the claimant count has increased at its fastest rate since 1992, means that it is worrying times for the labour market.

David Kern, chief economic adviser at the British Chambers of Commerce, has said that that the labour market figures reveal the desperate situation that the economy finds itself in, and with unemployment increasing and job vacancies falling, it is a situation that will not be short term.

The figures released today indicate firmly towards a further 0.5 percent cut in interest rates before Christmas, believes Mr Kern.

Average earnings however in the three months ending in September increased by 3.6% ,which is in line with forecasts as firms look for experience causing a reduction in vacancies.

The number of people receiving jobless benefits increased 36,500 to 980,900 according to the Office for National Statistics.

The spiralling joblessness in the UK economy has made it much harder for the Prime Minister as he is hoping to create further tax cuts and raise spending in order to stimulate the economy.

John McDonnell, a Labour lawmaker who had challenged Brown for the Labour leadership said that these figures are dire and called for urgent government intervention to stall job losses as the grip of recession tightens.

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