The UK suffers first rise in unemployment in seven months

A report by the Office of National Statistics (ONS) shows the UK’s unemployment total climbed by 21,000 to 1.7 million in the three months to February.

 
This increase in the jobless rate was the first since August 2015. The claimant count, which measures people receiving out of work benefits, also made its first shift since August, rising by 6,700 in March.
 
A number of causes for the hike have been suggested, including the possibility of a European exit creating economic uncertainty and the introduction of the National Living Wage forcing companies to cut jobs. 
 
Financial experts have also pinpointed the economic slowdown which is affecting the manufacturing and construction sectors as a possible factor.
 

The question is, why does this small increase in joblessness matter? 

 
Income shocks, such as redundancy or sudden unemployment, are the leading cause of indebtedness. With many people having made no provision for a sudden, catastrophic reduction in income, they find they are no longer able to meet their monthly credit commitments.
 
Apart from the hardship unemployment brings to individuals and families, a rise in unemployment could land a blow to efforts to keep the economy growing. Consumer spending, including a large amount driven by borrowing, has boosted the economy over the last few years. Any drop in purchasing caused by joblessness or low confidence is likely to cause a significant hit on Gross-Domestic Product (GDP) growth, leading to further job cuts. 
 
If you have been made redundant and are struggling with debt, contact our advisers on
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