Belfast Telegraph

Saturday 23 August 2014

Grim unemployment levels are nothing new

The beauty about regular economic statistical data is that there's generally a long enough period between releases to allow readers of this and other columns to forget the arguments and prose we've used while talking around whatever subject happens to be in vogue.

That's the theory, but in practise it can be difficult to take a fresh look at statistics which prove what we already know rather than expose a new trend which gives us a whole new take on the norm.

At 9.30 yesterday morning it was the labour market's turn, once again, to state the bleedin' obvious, as you might say.

The dole queue's getting longer and, even though the headline unemployment figure calculated by the Labour Force Survey has come down, the number of economically inactive people - ie those not looking for work including students, pensioners and those on incapacity benefit - has gone up.

In effect, these are the trends that we've been witnessing over the last few months and even years, so it's probably not a bad idea to have a look at where we really stand compared to a few years ago rather than just last month or last year.

Handily, our eager economists have this sort of information at their fingertips.

Yesterday's historical treat took us back to the summer of 2007, one when the first inklings of trouble were brewing in the world's heavily over-leveraged economy and Robyn with Kleerup was number one in the UK hit parade with 'With Every Heartbeat' (one of these events proved to be more important than the other, but I'm sure there was no telling Robyn or Kleerup at the time).

Back then BNP Paribas casually announced it was closing three hedge funds which specialised in US mortgage debt.

"Hang on," the financial 'boffins' said, "let's take a closer look at this debt and see if it really is worth the piece of paper it's written on."

They did and it wasn't. You know the rest so I won't bore you, but if you look at yesterday's local labour stats you'll see how the subsequent fall out wasn't just confined to the suburbs of Las Vegas or the apartment blocks of Manhattan.

In that summer of 2007 Northern Ireland saw a record unemployment low at 23,500 - a hugely impressive rate and one which must have caused much excitement. Today the number of people on the dole stands at 61,500, a rise of 162% in the five years since then.

A worrying statistic, particularly when you consider more losses look likely in the short term as the lag from the current secondary downturn works its way through.

But don't get too down because it's all relative.

Back in October 1986 there were 123,500 out of work in Northern Ireland, more than double the current rate.

So, things are bad but on a historical basis they're not that bad, particularly when you consider Nick Berry was number one in that month with 'Every Loser Wins'.

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