John Healey has been hit with a triple whammy on his first full day as Chancellor of the Exchequer. The Office for National Statistics (ONS) has just published the latest figures on jobs, public sector finances as well as an update on their troubled Labour Force Survey (LFS). There’s bad news, news that only looks good because it’s less bad than usual and truly disastrous news.
First of the three is the jobs destruction – kicked off by the previous Chancellor’s £25 National Insurance tax raid and hikes to the minimum wage. This has continued with 85,000 more employees disappearing from payrolls compared with a year ago, with the unemployment rate falling only slightly to 4.9 per cent.
But the jobs figures are really bad news when you split them out by age group. The unemployment rate for 18-24 year olds has climbed to 14.8 per cent – the highest of any age group. Reversing the trend of youth unemployment should be Healey – and Burnham’s – defining mission.
On wage growth, private sector pay rises slowed to 2.9 per cent while public sector ones sped up to 5.5 per cent. The ONS put the climbing public sector pay growth down to ‘base effects’ caused by NHS pay rises being paid earlier this year than in 2025. But the public won’t care about that – they’ll just see the direction of travel for our economy which the below graph suggests.
