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For decades, the North East has had insufficient employment for its working
age population,
resulting in high unemployment and movement out of the region. In recent years,
official
unemployment has fallen considerably, both regionally and nationally. However,
unemployment
rates represent only part of the picture, since many people of working age
who are not working may
not be counted as unemployed (and are not in receipt of out-of-work benefit
such as Job Seekers
Allowance). Current analysis and policy-making is therefore focused on economic
activity,
employment rates, ‘worklessness’ and ‘employability’.
Remarkably, the unemployment rate in County Durham in 2005-06 was only just
over one
percentage point above the national rate and in Darlington was a little below
the national rate. But
the employment rate, a more useful indicator, points to a high incidence of
worklessness in County
Durham. County Durham has a relatively high proportion of people of working
age who are not
working and, consequently, a lower employment rate (70.0%). Darlington, with
an employment rate
of 75%, is slightly above the national average. As Table 3 shows, across County
Durham and
Darlington together, in 2005-06 some 104,700 people were either unemployed
or economically
inactive, but over 67,000 of them were estimated/reported as not wanting a
job; that would include
people looking after a home or early retired people who do not want a job.
The figures can be
interpreted in various ways, but the important message is that significant
numbers of people are
out of work, notably in County Durham. There are many people who might be
in work – and, in a
more vibrant economy, as in other regions, they probably would be in work.
Economic inactivity in County Durham is highest in the former coalfield areas,
where there is
particularly high reliance on Incapacity Benefit – only some of which
is linked to the legacy of heavy
industry. The rate of economic inactivity amongst the 50+ age group is much
higher in the North
East than elsewhere; almost 38% of North East people in this group (aged 50
to retirement age)
are economically inactive, compared to just 27% nationally.
The Government’s long-term aim is to reach an 80% employment rate, some
ten percentage points
above the present County Durham rate. Considerable public policy emphasis
is being placed on
tackling ‘worklessness’, especially in the North East and particularly
in relation to people receiving
Incapacity Benefit, but also lone parents and older people. New initiatives
have been introduced
(e.g. JobCentre Plus ‘Pathways to Work’, the New Deal for Lone
Parents, Action Teams for Jobs
and Aim Higher Routeback) and reducing worklessness and enhancing employability
are important
themes in One NorthEast’s new Regional Economic Strategy. But such policies
are necessarily
constrained by the limited availability of jobs, low pay and the ‘benefit
trap’, and many other factors
and barriers such as low skills and caring responsibilities. Many people who
are economically
inactive, perhaps on Incapacity Benefit, have health problems and mental or
physical disabilities
that restrict the range of work they can do. Support for potential employees
with disabilities is often
not adequate.
The overwhelming majority of people in work are employees; relatively few
are self-employed. Only
7.2% of economically active people in County Durham are self-employed and
just 6.6% in
Darlington, below the national average of 9.2% (Great Britain).
68.4% of employees in County Durham and 67.5% in Darlington have full-time
jobs – much the
same as the figure for Great Britain (67.9%). But there are big differences
in relation to occupations
and earnings. There is an under-representation of professional/managerial
occupations in County
Durham, while Darlington is close to the national average (Table 4). The North
East generally has
low earnings (Table 5).
