By Max Clarke

The Office for National Statistics this morning revealed a 0.2% climb in unemployment as a further 38,000 brought the jobless total to 7.9%. Following is comment from analysis from business owners, economists and workers’ union representatives:

Andries Smit, founder of business-to-business group buying service, SME Discounts, attributes the rise to corporate restructuring: "Corporate restructuring programmes are having a real effect on unemployment at the moment… these skilled workforce redundancies are of particular concern as they are the big spenders who we rely on to carry the economy on the high street.

"Their redundancies and reductions in spend cascade all the way down to even the lower income families.”

"Earnings growth rates are at just 2.6%,” continued Smit, “with inflation bordering on 4.4% and an expected increase to 5%. This means that not only are more people unemployed, even those that are employed are moving backwards from a real spendable income perspective.

"This is 38,000 more families forced onto the dole queues and struggling to survive in the face of rising costs,” said Dave Prentis, public sector union, Unison chief, before blasting the government’s economic strategy: "The Government's savage cuts have cut off vital opportunities in the public sector and the private sector is struggling to withstand the economic downturn.

"The Government's economic strategy is in tatters. They need to stop the cuts and restore hope by planning for growth."

Echoing Prentis' calls for an economic rethink, Brendan Barber, Trades Union Congress general secretary, commented:

"Government complacency over growth is now coming back to haunt the UK and the Chancellor's plans for job creation are woefully inadequate. Even if successful, the new enterprise zones will create fewer jobs in the next four years than have been lost in the last three months.

"The Chancellor urgently needs to put forward a plan B before our economy heads back towards recession and even more people lose their jobs."

Dr John Philpott, Chief Economic Adviser at the Chartered Institute of Personnel and Development (CIPD) was not surprised by the figures released, despite being disappointed by them.

“Today’s jobs figures are very disappointing but not unexpected. After a few surprisingly upbeat quarters the UK jobs market has finally caught up with the reality of weaker demand in the private sector and the impact of mounting public sector job cuts," he said.

“As for the detail the figures are a mix of ups and downs — unfortunately most of them bad news. Unemployment is up (by 38,000 to 2.494 million on the quarterly Labour Force Survey measure and by 37,100 to 1.56 million for the month to June as shown by the number of people claiming Jobseeker’s Allowance).

"Jobs up for men (49,000) but down (24,000) for women, a clear signal of the impact of public sector jobs cuts. Youth unemployment is up (15,000). Redundancies are up (32,000) but vacancies are down (22,000). The number of people working part-time because they can’t find a full-time job is up (83,000 to 1.264 million). The rate of pay rises is up (2.6% including bonuses) but only by around half the rate of price inflation.

“The jobs market has clearly taken a turn for the worse since the start of the year with unemployment on the headline measure as well as the claimant measure now increasing. All that remains to be seen is how bad things get but given everything else we know about the economic outlook for the UK economy this year and next it looks like the only way is up for unemployment.”

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