Belfast Telegraph

One in four in Northern Ireland is economically inactive, the highest rate in UK

By Margaret Canning

Economic inactivity is spreading in Northern Ireland as the region continues its slide with more than one in four people outside the workforce – the highest level all 12 UK regions.

According to the labour force survey from the Department of Enterprise, Trade and Investment (Deti), the rate of economic inactivity in Northern Ireland is 27.4%.

The UK average is 22.2%, while the next worse-off regions for economic inactivity are the north east of England, at 25.3%, and Wales at 25%.

A Deti statistician said Northern Ireland had been bearing the UK's highest rate of economic inactivity since the late 1990s.

The latest figures show 562,000 people were economically inactive in Northern Ireland in the survey for December 2012 to February 2013, an increase of 15,000 over the quarter.

Deti estimates that 31% of the economically inactive in the 16 to 64 age group are students, just under one quarter are looking after the family or home, a quarter are sick/disabled and 12% are retired.

Ulster Bank chief economist Richard Ramsey (below) said the high level of economically inactive people could be described as the "hidden unemployed" as many people returned to education after being unable to find work.

He said the high levels were caused by the higher number of students in further and higher education, and the higher numbers of people claiming invalidity and sickness benefit than in other parts of the UK.

Reversing the historic trend of economic inactivity was not a high priority for policy makers here because of the coalition government's policy of welfare reform.

"The main impacts will come from national welfare reforms, rather than anything local," Mr Ramsey said.

"The effect would be that many on sickness-related benefits would be re-classified as jobseekers, potentially pushing up the unemployment rate to over 10%. But any positive effect on the economy would be a 'slow burn'." Meanwhile, the overall unemployment rate in Northern Ireland increased by 0.4% to 8.4% between December and February, which was also up 1.5% over the year.

In the same 12 months, the UK's unemployment rate was down 0.3% to 7.9%.

Background

The unemployment rate in Northern Ireland increased by 0.4% to 8.4% between December and February. That was up 1.5% over the year, while the UK's rate was down 0.3% to 7.9%. The official count of people claiming unemployment-related benefits expanded by 100 people in March to 64,800, or 7.2%, the second highest rate in the 12 UK regions.

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