Belfast Telegraph

OK, let's dance for a bit but we can't get too cosy

By David Elliot

There's nothing like a raft of data at 9.30am and a 20-minute deadline to lift the morning fog.

Yesterday it was employment data (or unemployment data depending on your mood) but this was also accompanied by production data, service sector data and construction data, not to mention some flag-waving and collective pats on the back from the Enterprise minister.

Who can blame her? A look at the figures shows the unemployment rate in Northern Ireland has fallen by 1% in a year and that's a pretty good performance.

And once the production and service sector figures appeared you can imagine there was a bit of an impromptu conga around Stormont.

Great news indeed but while we're all for a bit of good cheer to wipe away the recessionary blues, we can't get carried away.

Firstly, the stats are historical and cover the period from September to November, not a significantly long time ago but not as up to date as the claimant count data. It shows a rise in the number of people claiming dole and refers to December, a month when you'd expect more people to be working to cover the busy Christmas period.

Secondly, the economically inactive rate - people who aren't actually looking for work - climbed by 1,000 people to 27.1% and remains the highest of the 12 UK regions.

Thirdly - and we've been saying this until we're blue in the face - employment data is a well-known lagging indicator of economic activity, one which could be six months behind in reflecting the actual health of the economy.

So while we should all be joining the conga, we shouldn't be kicking our legs too hard.

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