Wednesday, 15 July 2009

The Unemployed and Those that Cannot Claim

I was reading today that the unemployment level has rising, to well, the number it was at the last time I was unemployed, in early 1996. But the following graph shows another untold story.

As you can see the gap between unemployment claimants and the level of unemployed has actually grown, largely since 1997 when Labour came to power. Now there are all sorts of people missing in that gap, some are those that do not and will not seek work, but another group is often overlooked.

I've had a lot of correspondence recently with a few local residents whose style of work is not the traditional work for a firm, but contracting. Fine you may say contractors are able to earn big bucks good luck to them. This is true when the times are good, but when there is a recession on there are less people looking to employ specialists like them, especially at the rates that they need for their short term expertise. Don't forget these people often have families that need to be feed, housed and clothed too.

The problem is that often those contracts take them overseas, where they don't pay National Insurance. Or they set up one man companies and the companies get paid instead of them directly but of course they have access to the company finances. Also this is the group least likely to sign on between jobs as they have normally expected another one to some along. As some have recently told me they have tried to hold off as long as possibly without claiming benefit to bide them over, but now they may find out that they do not have enough National Insurance contributions to gain benefit under the new system. There is a definite gap in our benefits system which if Gordon Brown had truly have eliminated 'boom and bust' would not now be an issue. But as he failed it is a growing one.

Ironically those who in the good times try not to be a burden to the Government are a part of that gap. I'm sure there are others but it is frightening just what a gap has opened up in the 12 years of Labour's means testing between those who are claimants and those who are unemployed. This remember is the Government who claim they are fighting poverty yet the above chart makes you wonder just what holes various people have fallen through and just how they may actually be being counted in the figures given out by whatever department minister is spewing them forth.

UPDATE: As Andrew Reeves kindly reminded me, unlike that last time when I was claiming Job Seekers Allowance for 9 months after 6 months as an unemployed person you can no longer claim even income support. Considering I was out of work for 9 months when the job market was picking up, heavens knows what state some people are in with jobs being harder and harder to find.


  1. Interesting graph. I got my very first job at that peak in 1993. At the time, I didn't have much of a clue that unemployment was so high, just that it was blinking hard getting a job and it was for relative peanuts.

    My friend at the time chose the very route you describe and became a contractor (forming his own company) and earned about 5 times what I did (and earnt more then that I do now) I chose the "safe" option. I never kept in touch with him as his job took him all over the place but I hope he put lots of that extra cash into savings.

  2. Stephen, don't forget that now after 6 months you don't get any income support if you are unemployed!