ILO Unemployment Figure Increases Despite Lower Jobless Claims
The fact that ILO unemployment has risen to 7.2 percent in December from 7.1 percent in November has caused some consternation given that jobless claims fell 27,600. Before trotting out the usual “damned lies and statistics” line, it’s worth actually understanding the two metrics.
ILO unemployment is a measure of all those actively looking for work who can’t find it. In essence, it is the percentage of those who can’t find a job and who don’t have an excuse not to be working. It is not just a measure of those eligible for benefits. Unemployment numbers as measured by the claimant are just a raw figure of the number of people claiming unemployment benefits.
This interaction is important because the number of people in employment has risen by 396,000 over the year, whilst the number of people not employed and not seeking or available to work has dropped by 23,000 of the course of the year. Therefore, it stands to reason that with a growing pool of individuals classed as seeking & available for work, the unemployment figure needs to be ever greater in order for the ILO measure to come down. This is why you can get more people entering work and see the ILO measure increase.