The number of people unemployed in the UK increased by 177,000, between December 2008 and February 2009, to reach more than two million. The number of actual jobless benefits claims rose also by nearly 74,000, in March, to reach nearly 1.5 million.
The Office for National Statistics confirmed that the unemployment rate had reached 6.7% for the period between December and February, which was is an increase of 0.6% over the previous quarter. The ONS went on to confirm that the growth in average earnings had sunk to its lowest level since 1991, when records began. This has been attributed mainly to the decline in city bonus payouts in the wake of the credit crunch.
The private sector actually saw a decline in wages of 0.5% over the three months from December to February, which left many financial experts and leading economists in a state of shock.
The problems have been compounded by a drop in the number of new employment vacancies that are being advertised. During the first quarter of 2009, there were just over 460,000 UK job vacancies advertised, which was down by nearly 70,000 from the previous quarter. This was also the lowest since 2001, when records began.
The news has not been welcomed by financial help charities and debt advice specialists. Since the onset of the credit crunch there has been a sharp growth in the number of consumers that are struggling to make their monthly loan repayments, or keep up to date with credit card debt. There has also been an increase in the number of consumers seeking IVA advice in an effort to get out of debt, however the unemployed do not qualify for IVAs and may find a Debt Management Plan to be a more appropriate solution.