UK unemployment rate slips unexpectedly to 4.9% in February, but payroll numbers fall ahead of reopening

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Britain entered a tough new lockdown in January

The UK unemployment rate fell unexpectedly in the three months to the end of February, data showed on Tuesday, ahead of the country’s latest loosening of coronavirus restrictions.

But the number of employees on payrolls fell by 56,000 in March compared to February, painting a mixed picture about the UK jobs market.

Headline unemployment slipped to 4.9% from December to February from 5% in the previous quarter, the Office for National Statistics said.

It beat economists’ expectations of a rise to 5.1%, but analysts said the figure was flattered by a rise in people becoming economically inactive, meaning they had stopped looking for work.

Yet there were some signs of progress in hiring. The number of vacancies for jobs rose nearly 16% in March compared to February, according to experimental data.

The UK economy is gradually reopening from the tough restrictions that were in place from January to March. On April 12, pubs, non-essential stores and hairdressers were allowed to reopen as the vaccine drive picked up speed.

Britain’s government’s furlough scheme currently pays the wages of roughly one in five employees and has been a key reason that the country’s unemployment rate has stayed relatively low, rising only 0.9 percentage points in the year to February 2021.

“The slight fall in the unemployment rate… suggests that the government’s job furlough scheme is still insulating the labor market from the worst effects of the pandemic,” Thomas Pugh, UK economist at Capital Economics, said.

However, economists expect the UK unemployment rate to climb once the furlough scheme is wound down towards the end of the year.

James Smith, developed market economist at ING, said: “Like most economists, we expect the unemployment rate to rise this year.”

He added: “The end of the furlough scheme, and to a lesser extent, a potential increase in inbound UK migration later this year (partly reversing last year’s population fall) are both likely to trigger a temporary spike in the jobless rate to 6-6.5%.”

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The UK’s failure to find evidence of systemic racism in a government-issued report is a laughable example of hypocrisy

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  • A government-issued report in the UK found no evidence of systemic racism in the country.
  • A government clearing itself of any wrong-doing is a mockery to the real, institutional problems at hand.
  • Mohammad Zaheer is a journalist and political commentator.
  • This is an opinion column. The thoughts expressed are those of the author.
  • See more stories on Insider’s business page.

Controversy has arisen in the UK after a much anticipated report investigating race and ethnic disparities apparently found no evidence of institutional racism in the country; instead heralding Britain as a model for other white majority nations.

The United Kingdom, much like the rest of the world, is having a moment of reckoning about racial injustice, further complicated by its colonialist past. In the wake of the Black Lives Matter protests in 2020 that followed the killing of George Floyd in America, the UK government established the Commission on Race and Ethnic Disparities to help address concerns about the racial inequalities that permeate British society even today. But the report’s failure to find evidence of systemic injustice should leave us all questioning its authors’ intention.

Impartiality

Due to the importance of such reports – which gain considerable media coverage and are often relied on by government officials, academics, and policy makers to inform their decision making – it is imperative that the members of the commission are impartial experts that have tremendous credibility. However, eyebrows were raised when this particular panel, which is meant to be independent, seemed to mostly consist of individuals whose ideology was in line with the Conservative government’s views and lacked expertise in many of the matters being investigated. Former Shadow Home Secretary and current Labour MP Diane Abbott – the first Black woman to be elected to Parliament – went as far as accusing the government of consciously packing it with people who did not believe in institutional racism. And others who took part in the report are now trying to distance themselves from its results.

Therefore, it shouldn’t have come as a surprise, then, that this report went against the findings of several other major inquiries in the past 20 years that had found evidence of systemic racism – including the landmark 2017 Lammy Review that found significant racial bias in the UK justice system. It has become apparent now that instead of taking the opportunity to truly explore the issues of racial inequality and discrimination, the report appeared to be tailored to fit a pre-determined narrative that suited the government and reaffirmed its skepticism of institutional racism.

There is plenty of evidence regarding systemic racism – in 2021, one would have to be willfully ignorant to deny it. But in keeping the discussion stuck at debating the existence of a deeply entrenched discriminatory phenomenon that clearly affects a significant percentage of the population negatively, the government has ensured that no progress whatsoever is made in addressing the resulting racial disparities – which was what we were led to believe the commission was set up to do in the first place.

Evidence of injustice is easy to come by

The reality is that we live in a country where COVID-19 has disproportionately taken the lives and livelihoods of its Black, Asian, and ethnic minority population. Black women in Britain are four times more likely to die in pregnancy or childbirth than white women. Black people are not only nine times more likely to be stopped and searched by the police, but are also twice as likely to be criminalised for drug possession than their white counterparts. Ethnic minority students, especially those from Caribbean or Gypsy, Roma and Traveller backgrounds, are significantly more likely to be excluded from school. Studies have shown that ethnic minority students are also less likely to be accepted in the country’s elite universities, even when they have the same grades as their white peers. Only recently, Black citizens were detained, denied their rights, and even wrongly deported from the country by the British government.

While the report does acknowledge that racial disparities still exist, its authors argue that “geography, family influence, socio-economic background, and culture and religion” play a significant role. Ethnic minorities opposed to the findings of the report seemingly get painted as perpetual moaners who’ve absorbed “a fatalistic narrative that says the deck is permanently stacked against them” and can’t bring themselves to appreciate the incredible progress Britain has made transforming itself into “a beacon to the rest of Europe and the world”.

Thus, the discussion has devolved into a farcical debate on patriotism, where those criticising this ‘positive’ news about Britain face accusations of just having an irrational hatred for the country instead of legitimate grievances. It feeds directly to the biases of much of the Conservative vote base, many who are vocal about how they believe people of colour, anti-racism campaigners and experts want to make everything about race, and how those complaining of racism have a victimhood complex.

The backlash and condemnation of the report has been swift and comprehensive. Several academics have criticised it as a sloppy piece of work and accused it of distorting and misrepresenting research. Many of the experts thanked for their help with the report have publicly come out and denied their involvement with its contents. And as I mentioned before, some of the commissioners have now come out and distanced themselves from the final report; with allegations that it was the government – and not the 12 commissioners – that produced many of the controversial sections of the finished product. The government has been urged to withdraw the report, with many rights campaigners fearing that its continued circulation will “take us back to the ‘colour bar’ of the 1960s.”

But whether a Prime Minister who has conducted an obvious attempt at whitewashing racism listens to such concerns remains to be seen. The hypocrisy of a government investigating itself by appointing ‘yes people’ to exonerate it and further its agenda – even allegedly rewriting their report to ensure the desired outcome – is galling.

The repercussions of this cynical act will continue to be felt, with the credibility of such ‘independent’ government commissions severely damaged. What is crystal clear, however, is that we cannot look to this administration for any meaningful action to address racial disparities. Our struggle for racial equality continues, it is just a shame that the government continues to actively make things worse for the marginalised communities it is also meant to serve.

Mohammad Zaheer is a journalist and political commentator.

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UK unemployment rate unexpectedly falls to 5% in January as the country looks ahead to reopening

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The UK is looking ahead to reopening thanks to a rapid vaccine rollout

  • The jobless rate dropped to 5% in the three months to January, from 5.1% in the three months to December.
  • Separate figures showed the number of people on payrolls picked up for the third month in a row.
  • The UK has suffered badly during COVID-19 but is looking to reopen thanks to a quick vaccine rollout.
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The UK unemployment rate fell unexpectedly to 5% in the three months to January, data showed on Tuesday, in an encouraging sign given the country’s plans to gradually lift its coronavirus restrictions.

Britain’s headline unemployment rate fell to 5% from 5.1% in the three months to December, the Office for National Statistics said, beating economists’ expectations of an increase to 5.2%.

Separate figures showed 68,000 more people joined payrolls in February than in January, the third monthly increase, although 693,000 fewer people were on payrolls compared to a year earlier.

“After yet another monthly increase, there were almost 200,000 more employees on payroll in February than three months earlier,” Sam Beckett, head of economic statistics at the ONS, said.

Beckett said that of the almost 700,000 people who have fallen off payrolls, almost two-thirds have been under 25, over half worked in the hospitality sector, and almost a third have been in London.

The UK has suffered over 130,000 deaths from coronavirus and one of the worst economic tolls in the world.

But its unemployment rate has been held down by the furlough wage subsidy scheme. And the country has rapidly rolled out COVID-19 vaccines, allowing it to plot its way out of restrictions by the summer.

Non-essential stores may reopen as soon as April 12 if the government feels cases are under control, with hospitality venues such as pubs potentially allowed to resume business and serve people outside. All restrictions may then be lifted as early as June 21.

“The continued success of the vaccine rollout provides us with hope for the future, and through our plan for jobs, we will continue to support people throughout the months to come,” UK chancellor Rishi Sunak said.

UK markets showed little reaction to the data. London’s FTSE 100 index was down 0.43% in early trading, while the pound was off by 0.4% against the dollar at $1.3806.

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Because of its colonial past, the UK has a duty to help residents of Hong Kong

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Thousands take part in a pro-democracy march in Hong Kong on June 4, 2020.

  •  Many of China’s oppressive policies in Hong Kong are facilitated by laws introduced by Britain.
  • The British government has failed to acknowledge the role its colonial legacy has played in the persecution of Hongkongers today.
  • A new visa scheme giving Hongkongers a path to UK citizenship is a good start – but it doesn’t go nearly far enough.
  • Jason Reed is the UK liaison at Young Voices.
  • This is an opinion column. The thoughts expressed are those of the author.
  • Visit the Business section of Insider for more stories.

In 2019, the government of Hong Kong proposed a bill that allowed the extradition of Hong Kong citizens to mainland China for trial. The bill set off months of protests, and eventually the Chinese government responded with a stricter measure that allowed for arrests of anyone in Hong Kong who voiced political dissent. 

In doing so, the Hong Kong and Chinese governments effectively ended the ‘one country, two systems’ framework, and subjected Hong Kong’s residents to the dictatorial rule of the Chinese Communist Party.

The sweeping national security law paved the way for a fascistic crackdown, with several high-profile pro-democracy figures arrested. Now, with every week that passes, there is a new, tragic case of a brave soul speaking out against Beijing and finding themselves locked away.

One recent example is radio DJ Edmund Wan Yiu-sing. “Giggs”, as he is better known, is charged with four counts of “doing an act with a seditious intention”. In other words, the Chinese government believes that Wan used his media platform to stir hatred and contempt against the authorities – although it has not offered any details of what “seditious” things he is alleged to have said.

Wan’s case is notable for a troubling reason. He was not charged under the national security law, or any other hurried new legislation from the last couple of years designed to quash brewing unease among pro-democracy activists. Instead, he was charged under the Crimes Ordinance, which has not been amended since 1972, when Hong Kong was still under British colonial rule. For a first offence on this charge, Wan could end up with a fine of HK$5,000 and two years in jail.

Last year, a group of British members of Parliament – all members of the governing Conservative Party – formed the China Research Group to campaign on issues relating to Hong Kong, and other China-adjacent areas of foreign policy. While their efforts have been admirable in drawing attention to China’s atrocities and forcing the government’s hand on matters of diplomacy, there has so far been a lack of appreciation of the role Britain has played in laying the foundations in Hong Kong for the oppression we are seeing today.

Imperial remnants

The Wan case is not the first time colonial-era British laws have been used to malicious ends by the CCP-controlled Hong Kong government. For instance, in April of last year, in an extraordinary indication of the disdain the ruling regime feels for those who speak out against it, Hong Kong chief executive Carrie Lam doubled down on a ban on face masks which had been introduced in October of the previous year.

Lam even went to court to defend her right to prevent dissenters from covering their faces, despite the raging coronavirus pandemic, thanks to another colonial-era British law. The law in question – the Emergency Regulations Ordinance – was introduced in 1922 to combat strikes by Chinese fishermen who were protesting against their pitiful wages. It was passed in a single day with minimal scrutiny, and it remains on the statute book, with appalling consequences a century later.

Unlike the CCP’s genocidal campaign against the Uighur ethnic minority in the country’s Xinjiang province, where Beijing claims nothing of note is taking place, the Chinese Communist Party likes to draw the world’s attention to its deeds in Hong Kong. It is as if the CCP is taunting Britain, the region’s former ruler. For instance, it released a statement via state propaganda channels last July urging the UK to ‘abandon the illusion of continuing its colonial influence’ there.

So while the Chinese government makes out as though it is rescuing Hongkongers from the grip of its British imperial overlords by oppressing them and reneging on its international commitments, it is in fact making use of the legacy of British rule in Hong Kong for its own dictatorial purposes. This fact ought to be acknowledged in the UK, and it should inform the UK’s response to China’s aggression in the region.

Last month, after the governments of China and Hong Kong said that they would no longer recognize British National Overseas (BNO) passports as valid travel documents, the British government implemented a new visa scheme, granting Hong Kong residents a path to UK citizenship. This is a good start, but in light of the above, it plainly does not go far enough.

Hongkongers, through no fault of their own, are caught in the middle of a deeply unpleasant diplomatic divorce between the UK and China. They are stuck under the thumb of an abusive parent and it is Britain’s duty to do everything in its power to help them upend and relocate their lives to the UK, even if that means embracing radical ideas. Half-measures will not suffice. Britain is Hongkongers’ only safe refuge now – they must be made to feel welcome.

Jason Reed is a policy analyst and political commentator. He is the UK liaison at Young Voices. Jason writes for the Times (of London), the Independent, the Telegraph, and many other outlets.

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The UK economy suffered the biggest slump in the G7 in 2020, shrinking a record 9.9% as COVID-19 hit hard

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UK GDP grew in Q4, but the country’s economy contracted sharply overall in 2020

The UK economy shrank by 9.9% in 2020 as the coronavirus pandemic battered the country, official Q4 GDP figures showed on Friday.

It was the worst contraction since records began and likely sharpest contraction overall in 300 years. It means the UK economy fared the worst out of the G7 group of rich democracies and among the worst overall.

The economy grew 1% in the final three months of the year, the country’s Office for National Statistics said, after dealing better than expected with a sharp tightening of restrictions in November. Britain’s gross domestic product had grown 16.1% in the third quarter.

But despite two consecutive quarters of growth, GDP remained 7.8% below its level in the fourth quarter of 2019.

Along with one of the worst economic downturns, the UK has one of the world’s highest coronavirus death rates, with more than 110,000 having so far died from COVID.

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Yet the UK has been one of the fastest countries in the world at rolling out coronavirus vaccines, after rapidly approving jabs from AstraZeneca/Oxford, Pfizer/BioNTech and Moderna.

The Bank of England cut its growth forecast for the UK economy in 2021 to 5% on February 4, saying the lockdown put in place in January would delay the recovery. It also expects Brexit to weigh on growth in the first quarter.

However, the Bank said that the recovery will be “rapid” when it comes, thanks to vaccines allowing people to go out and spend again. The BoE said it expects the UK economy to regain its pre-COVID size at the start of 2022.

The UK’s 9.9% contraction in 2020 compares unfavorably with the rest of the G7. The US economy shrank 3.5%, while Canada’s economy is expected to have shrunk around 5%.

Germany shrank 5%, France contracted 8.3% and Italy’s economy finished the year 8.8% smaller. Japan’s GDP is expected to have contracted around 5.5%.

Read More: BlackRock says investors haven’t fully priced in the structural changes brought about by the pandemic – and pinpoints 2 areas of the market that can still run for years

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