Orders of the Day — Unemployment

Part of the debate – in the House of Commons at 12:00 am on 24 July 1978.

Alert me about debates like this

Photo of Mr Harold Walker Mr Harold Walker , Doncaster 12:00, 24 July 1978

I hope the hon. Gentleman will allow me to make my own speech. I did not heckle him on this point. At that time the numbers temporarily stopped were included, and they were subsequently dropped. If the unemployment figures were calculated now on the same basis as then, they would be significantly less than that figure, which is part of the official record.

Equally, I reject the hon. Member's allegation that the Government were contriving to secure a drop in the numbers unemployed in September. I wonder what he means by "contriving. Is he suggesting that civil servants are juggling the figures at the behest of Ministers? I wish that he would make that clear.

One thing that the hon. Gentleman acknowledged—it is perhaps the first time that the Opposition have acknowledged it in these debates—is that an important reason for the increase in unemployment over the last four or five years has been the significant increase in the size of the labour force—at the rate of about 170,000 per annum.

I quote figures from memory, but I believe that between mid-June 1972 and mid-June 1977 the total number added to the labour force was about 900,000. In other words, we should have had to create an additional 900,000 jobs to stand still at the 1972 level. In the event we created about 400,000 additional jobs, and in mid-June 1977 there were more than 400,000 more people in employment than in mid-1972. In other words, while unemployment has risen, so have the numbers in employment.

I believe that the choice of subject for this debate was triggered by what I believe were wildly irresponsible headlines in last Thursday's newspapers about unemployment allegedly reaching 1·7 million in 1979. I want to take advantage of this debate not only to lay that bogy but also to say something about forecasting methods.

The figure of 1·7 million in 1978–79, a figure which had been submitted in a letter by the Chancellor of the Exchequer to the Chairman of the Sub-Committee of the Expenditure Committee, was a working assumption, not a forecast, made in autumn 1977 for the expenditure Estimates published in January 1978. As a figure it was not comparable with the official unemployment figure, because, unlike that figure, it included an allowance for people with jobs but temporarily laid off for a variety of reasons, and it included adult students registering for vacant jobs. Those categories, by long practice, are excluded from the official unemployment figures.

In early July there were about 110,000 adult students and about 11,000 people temporarily stopped. That latter figure is low by normal and historical standards. It has usually ranged between 6,000 and 60,000 in recent years.