Chamber says East Mids unemployment stats show disproportionate impact of lockdown

The East Midlands unemployment rate is once again above the national average, the latest figures show. 

Between October and December 2020, the region’s unemployment rate was 5.9%, up from 5.6% in the three months to November, according to the Office for National Statistics (ONS).

This was above the national average of 5.1% and the fourth highest rate among all UK regions, behind London (7%), the North East (6.5%) and West Midlands (6.1%).

The national figure – representing 1.74 million people – is the highest in almost five years, with 726,000 fewer people currently on the payroll during this period compared to pre-pandemic.  

Almost three-fifths of this fall (425,000 people) were aged 16 to 25.

Commenting on the figures, East Midlands Chamber chief executive Scott Knowles said: “This is the fifth month in a row in which the unemployment rate has risen for the East Midlands and the fact it is now 2.1% above pre-pandemic levels is clearly a major concern.

“Our region is suffering more than most others because we have borne the brunt of local lockdown restrictions. Leicester has been under the harshest restrictions for the majority of the past 11 months, while Nottinghamshire and Derbyshire were also placed into the highest tiers during the period these ONS figures cover.

“The Chamber’s Quarterly Economic Survey for Q4 2020 showed a net 6% of businesses in the East Midlands decreased their workforce.  While a net 16% expected to increase headcount over the first quarter of 2021, these intentions may well have been revised given the national lockdown imposed since then.

“Given how our local economy is reliant on industries such as hospitality, retail and tourism – sectors that are among the worst affected – it shows just how crucial the Job Retention Scheme is. While the Government’s roadmap to ending lockdown is welcomed, it’s absolutely vital the Chancellor announces a furlough extension in next week’s Budget.

“Young people continue to be disproportionately impacted by unemployment and while the Kickstart scheme – in which the Chamber has already helped to create hundreds of new six-month placements as a gateway organisation – is a great initiative, a longer-term solution will be needed to ensure we don’t lose a generation from the workforce. 

“Ultimately, we won’t see a reversal of the unemployment trend until our economy is fully open and functioning as normal. 

“The principle of caution in how we exit lockdown is understandable given the events of summer 2020 and the need to meet the Prime Minister’s promise for this move to be ‘irreversible’, but we hope figures like today are a stark reminder of the damage being done to our economy – meaning it’s important we meet the reopening dates provided this week.”