Is the jobs market cashing in on the feel-good factor?
While the summer of sport obviously brought money and tourism into the UK, what has been the real effects on the jobs market?
According to recent figures released by the Office of National Statistics (ONS), the recent sporting events has unquestionably delivered a boost to Britain’s jobs market as unemployment dropped and Britain’s part-time workforce soared. But the question still remains whether this boost is really sustainable.
The effect of sports
The ONS said the number of people jobless in the UK fell by 7,000 to 2.59 million in the quarter to July – putting unemployment at 8.1% – a big jump in the number of people in work, with London one of the biggest benefactors after hosting the biggest sporting event of the year.
However, a closer look at the figures reveals a much bleaker picture outside the country’s capital, with other regions around the UK seeing big leaps in unemployment. This has led a number of experts voicing their fears of what will happen once the euphoria of London 2012 is over. Quite how this will manifest itself is yet to be seen, but a look at other figures around the country do paint a worrying picture.
Away from the capital…
Outside London, unemployment rose by 23,000 in Yorkshire and Humber in the three months to July and by 16,000 in the West Midlands. Northern Ireland was also badly affected, with 10,000 more jobless in the quarter.
Meanwhile, Scottish first minister Alec Salmond was quick to blame his country’s stalling employment figures on the summer of sport, with the number of Scots unemployed increasing by 4,000 over the same three month period to 223,000, putting Scotland’s unemployment rate at 8.2% against the UK’s 8.1%.
The ONS figures lend further weight to concerns after showing London accounted for 91,000 (or 38.6%) of the 236,000 rise in the number of people in work in the quarter to July, the largest quarterly rise for two years.
There was also a big fall in those claiming jobseeker’s allowance, down 15,000 between July and August to 1.57 million – the largest monthly fall since June 2010. London also accounted for 5,500 of the fall in claimant count, providing further evidence of a sport-related boost.
Employment figures have also been coupled with a strong rise in UK industrial output in July and an official calculation of the boost from London 2012 suggested the economy made a positive start to the third quarter, and could actually be climbing out of recession.
It’s also worth noting the ONS believes ticket sales will add about 0.2 percentage points to economic growth in the third quarter, based on ticket sales of £580 million as provided by the event organisers.
However, Unison general secretary Dave Prentis remains sceptical, saying the Government needs a long-term plan of job creation to ease the UK’s economic woes. “For families suffering the misery of unemployment, any decrease will be welcome news, but it is clear when you look at the bigger economic picture that any talk of growth is premature,” he said.
A boost for tourism
Two sectors that will probably continue to receive a boost for some time to come, however, are hospitality and tourism. But there is still work to be done to capitalise on the good work of our hotels, restaurants and pubs.
Culture secretary Jeremy Hunt has recently called on UK businesses to use the recent positivity to turbo-charge the tourism industry, helping to create jobs and prosperity. And the Government will also encourage Britons to holiday in the UK by investing a further £2m in marketing domestic tourism – an announcement welcomed by national tourist board VisitEngland.
But is this enough? Mary Rance, chief executive of tourism trade association Ukinbound, called for the Government to act quickly if it intends to deliver on its promises of a new legacy for the UK’s tourism and hospitality industries. She cited the need to do more to tackle issues around airport capacity and slow visa applications as key points of focus.
So, what’s the verdict?
So, whether the events of the summer will give an overall boost to the economy is likely to be a hotly argued topic until we see the results one way or the other. Early indications show the recent sporting events have led to a boost in jobs, but have had a disappointing impact on high street sales in July and August, with people avoiding the capital due to the expectations of overcrowding.
What is certainly true is we’ve all been inspired by the incredible performance of UK athletes, and the legacy they have left cannot just be counted on a financial basis.