Unemployment (North-east)

Debate between Stephen Hepburn and Iain Wright

Wednesday 20th June 2012 Westminster Hall

[Mr Wright]

My hon. Friend is absolutely right. She has been a strong champion in this regard, both in this House and beforehand, standing up to make sure that women have the rights they require to fulfil a vital economic role. In our region we certainly need female, and part-time, workers.

I want to mention the loss of jobs in recent months. Between June 2010 and December 2011, the latest period for which figures are available, the north-east lost 7,000 manufacturing jobs and 84,000 construction jobs. According to statistics obtained by the TUC, in the north-east nine jobseekers are chasing each job vacancy. In contrast, in Oxfordshire there are just 1.8 jobseekers for every vacancy. It is therefore more than five times more difficult to find work in my constituency than in Oxfordshire. It is not that the people do not want to find employment or are workshy. There are no jobs to fill.

I could mention statistics until I am blue—or red—in the face. Many people will gain some comfort from statistics, large numbers or percentages. However, behind every statistic lies a human story of a person who is made redundant and is worried about how they will pay the bills and put food on the table, or of someone rejected after making their umpteenth job application and fast losing hope and sense of self-worth, or of a parent worried about how their son or daughter will get a job or career without any experience.

[Mr Stephen Hepburn (Jarrow) (Lab)]

My hon. Friend has made some telling points. Is it not important to stress that unemployment, especially among young people, is not an easy option? The unemployment benefit for people under 24—their dole—amounts to £8 a day. Without parental support or friends, they have to feed and clothe themselves and pay their utilities from that sum. It is not an easy option.

My hon. Friend rightly mentioned the serious issues in south Tyneside. In Jarrow, an extra 200 young people went on to the dole last year. With 15 people chasing every job, there is little or no prospect of their getting one.

[Mr Wright]

My hon. Friend is right. I will come to the terrible issue of youth unemployment in a moment. Let me just mention further unwanted, gloomy news on the jobs front in recent months.

The closure of the Rio Tinto Alcan plant, with the loss of 515 jobs directly and the threat to 3,000 jobs in the supply chain, is a major blow to the economy of south-east Northumberland. My hon. Friend the Member for Blyth Valley (Mr Campbell) is in attendance and I have spoken to my hon. Friend the Member for Wansbeck (Ian Lavery) today, who wanted to attend, but is hoping to catch Mr Speaker’s eye in the debate on Remploy.

The closure of the BAe factory on Scotswood road in the constituency of my hon. Friend the Member for Newcastle upon Tyne Central (Chi Onwurah) brings to an end a century of remarkable industrial innovation on the banks of the Tyne. The factory was started by that astonishing, underrated Victorian entrepreneur, William Armstrong. However, far from looking to the past, the closure undermines the vital links between British military capability and manufacturing and industrial capacity.

The growth in long-term unemployment and youth unemployment is of particular concern. I have mentioned that to hon. Friends. The north-east has far too often been permanently scarred by people being on the dole for many months and years, or by young people leaving school or college unable to find work. That was so in the 1980s, when the closure of the steelworks, shipyards and coal mines left an unwanted and enduring legacy of poor health, lower life expectancy, poverty and family breakdown, making it more difficult for the economy to bounce back into prosperity once the recovery starts.

The longer a person is out of work, the easier it is for them to lose skills and experience, and the more difficult it is to get back into work. That is especially true when more and more people have more recently lost their jobs, and therefore have more recent experience in the job market.

In Hartlepool, the number of people who have been claiming JSA for more than 12 months has risen in the past year by more than 245%. One in four young men under the age of 24 are out of work in Hartlepool. Such figures are not sustainable economically, socially or ethically. I fear that we are repeating the policies and mistakes of the 1980s and that there will, once again, be a lost generation of young people unable to fulfil their massive potential, believing that the only way they can get a proper career is by leaving the north-east altogether.

We have had good news. Only this week a new retailer announced the creation of 150 jobs in Hartlepool, but overall the job situation is gloomy and set to get worse. The Centre for Economics and Business Research forecasts that unemployment in the north-east will rise to 12% this year and to 13% by 2016, largely as a result of further and deeper public sector redundancies.

Government policy is making the unemployment situation in the north-east much worse. The Government’s insistence that public sector redundancies are necessary and that private sector employment will somehow bloom in the face of these cuts is naive and economically ignorant at best, or is cynically and deliberately driven for ideological and political purposes. If Ministers—or Whips—genuinely believe that the public and private sectors are separate and distinct entities, and never the twain shall meet, that shows a profound misunderstanding of how the modern economy works.