George Osborne’s economic recovery appears to have failed in the North, the latest unemployment figures have suggested.
The Chancellor’s opponents have seized on new figures showing the North East bucking a trend in falling unemployment as proof of a growing North-South divide.
Unemployment in the North East remains the UK’s highest, with a slight rise of 5,000 to 10.4%. Nationally unemployment was down to 7.7%.
The so-called claimant count - the number claiming jobseeker’s allowance - fell by 32,600 in August to 1.4 million.
While there was some good news in the region with the number of people moving from economically inactive into work rising by 11,000, the increased number of people losing their job was a blow to hopes of the Chancellor’s claims of a growing economy reaching the North East.
This week Mr Osborne spoke of his confidence that the economy was healing after years of sluggish growth.
Durham MP Grahame Morris said though that it was difficult to see signs that the region was included in an economic revival apparently limited to the South.
He added: “There has been little sign of the green shoots of growth in East Durham over the last three years with unemployment rising by 22%, and remains higher today than at the last election.”
He was backed by Durham North MP Kevan Jones, who said there was an urgent need for action on North East unemployment. Referring back to the recent Lord Adonis debate on the North East economy, Mr Jones said the region did not need more reports “on regional structures or jam tomorrow”. He added there was a danger of a lost generation of young people if action was not taken.
But the North East Chamber of Commerce insisted there were positives in the latest figures.
Policy director Ross Smith, said: “It is good to see employment estimates up for the second successive month, but another slight rise in unemployment is a reminder that we must guard against complacency.
“While welcome, two months’ growth in employment levels does not reverse the negative changes we have seen throughout 2013, hopefully it represents a positive trend as we approach the end of the year.
“Once again, claimant count figures continue to fall and stand at their lowest levels for over two years, which is great news.”
Berwick MP Sir Alan Beith said the good news overall was undermined by the difficulties facing job hunters, adding: “Further falls in the number of people out of work are good news for the Berwick constituency, although as the figures are not seasonally adjusted they need to be greeted with caution.
“The Berwick constituency has a much lower than average unemployment rate, but that is no comfort to those seeking work. I am working with local businesses to encourage them to take on apprentices and take advantage of schemes to assist with employing people and with further education providers to make sure learning to support apprentices and other workers is in available.”
The Government insisted the economy is “turning the corner“ as the number of people in work increased by 80,000 in the quarter to July, rising to 29.84 million, hitting another record high as the population continues to swell.
Minister for Employment Mark Hoban said: “This is a really encouraging set of figures, with the number of people in work rocketing by 80,000 in only three months - a rise driven entirely by a growth in full-time jobs.
“The private sector has created jobs for 1.4 million more people under this government, and there are now more people employed in the private sector than ever before. These are all positive signs that the UK economy is turning the corner.”