Unemployment hits 1.92m

Wednesday, 21 January 2009 04:25

The UK now has 1.92 million people out of work - the highest level since 1997.

The unemployment rate rose to 6.1 per cent, between September and November, according to Office of National Statistics (ONS) figures released today, with 131,000 people losing their jobs.

The ONS report showed job vacancies dwindling and an increase in people of working age without employment.

There are signs that jobs are being translated into part time work, with a fall in full-time employment of 89,000 over the quarter compared to an increase of 63,000 in part-time employment.

Research from Nationwide shows 34 per cent of people are now more concerned about job security than a year ago.

Robin Bailey, director at Nationwide, said: "Job security has become a major concern and it is important that people do not rest upon the hope that they will not experience redundancy.

"By acting now people can take steps to lessen the financial impact of losing their job and make sure, should the worst happen, they are in the best position to weather the storm and get back into employment as soon as possible."

Richard Lambert, CBI director-general, warned unemployment figures are set to get worse.

"The combination of falling demand and global credit constraints is pushing unemployment sharply higher."

However, he claimed the effect of interest rate cuts, falling inflation and the government's tax stimulus would be a "powerful stabilising force".

"We hope Monday's package of measures will also help to reassure viable companies that they won't run into trouble in the coming months because of a lack of credit," he added.

Nationwide has issued the following tips to help people facing an uncertain future:

• Save enough money to cover four months' income as an emergency fund
• Look at monthly outgoings and consider any cost savings which can be made and add these to existing savings
• Consider making mortgage overpayments now to provide a cushion for the future and, if concerned about unemployment, discuss options to reduce mortgage repayments in the short term by talking to the lender (e.g. extending the mortgage term, changing to interest only repayments)
• Consider consolidating unsecured debts
• Delay making large purchases until job security returns
• Seek a review with a financial consultant for advice on protecting and making the most of existing financial arrangements, and to obtain help in understanding any protection products already held.

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