Thursday, November 01, 2007

Rise in Foreign Employment in the UK

Source: Foreigners fill new UK jobs, Warning Signs Over Employment

Although unemployment rates remain steady, for the first time in recent history, employment rates in the UK are barely rising. Typically, there are as many as 200,000 new jobs created each year. However, recent trends show that considerably fewer new jobs. Analysts blame this change on three key developments.
The first development involves the arrival of new immigrants. In the past two years, over 540,000 foreign workers have replaced British nationals, accounting for nearly all of the new jobs created. Particularly vulnerable to this trend are those citizens aged 18-24. Over the last year, the employment rate among this group fell drastically from 65.5 percent to 64.1 percent. Although general unemployment rates in the UK do not seem to be increasing, unemployment among the under-24 population continues to rise.
The second development deals with individuals working in temporary positions. Many who fall into this category are there by choice, because they prefer the flexibility temporary employment offers. However those reporting they took temporary work only because they could not find permanent work has risen 12 percent in the last year to 400,000, effectively ending a 10 year decline in this demographic.
The third factor is that there are nearly eight million “economically inactive” people of working age. The “inactive” members include those who have left the labor market voluntarily and those who wish to re-enter the market. Curiously, there are more than two million people wanting to re-enter the market, as compared to 1.6 million who are classified as unemployed by choice.
Although these numbers are relatively telling, there are still questions that remain unanswered. Three of the largest classes of unemployed are those who retire early, students and those who are temporarily ill. It is not clear if these individuals are retiring early or returning to the classroom early because that is their choice, or if they are doing so out of necessity because they are unable to find employment. It is possible that the ten percent increase in the number of individuals retiring early could reflect sickness and redundancy; it is equally possible that this increase reflects a conscious decision to lead a more leisurely life.

Questions for Discussion
1. Are these employment statistics likely to result in stricter UK immigration policies?

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