U.K. Unemployment Claims Jump to Highest Since 1997

[Joanne98]

Source: Bloomberg


Feb. 17 (Bloomberg) -- U.K. jobless claims unexpectedly jumped in January to the highest level since Tony Blair led the ruling Labour Party to power almost 13 years ago as the recession destroyed work at businesses from carmakers to banks.

The number of people receiving unemployment benefits rose by 23,500 from the previous month to 1.64 million, the highest since April 1997, the Office for National Statistics said today in London. The median forecast in a Bloomberg News survey of 27 economists was for a drop of 10,000. The jobless rate on that basis stayed at 5 percent.

The Bank of England said last week that employment is at risk of falling “significantly further” if the economy’s recovery from the longest recession on record falters. Prime Minister Gordon Brown is counting on the pickup to gather momentum and help him to claw back voter support in time for an election due by June.

“It’s a concern given that we thought the labor market was improving,” George Buckley, chief U.K. economist at Deutsche Bank AG in London, said in a telephone interview. “Firms are faced with the possibility that the level of economic activity is lower and weaker than they thought, and that raises the possibility that they’ll decide to shed jobs in the future.”


Read more: http://www.bloomberg.com/apps/news?pid=20601085&sid=aBnXUou9D74c