Employment: Job Creation

Lord Freud Excerpts

Wednesday 16th December 2015 Lords Chamber

[Baroness Stedman-Scott]

To ask Her Majesty’s Government how many jobs have been created in the European Union compared to the United Kingdom in the past year.

[The Minister of State, Department for Work and Pensions (Lord Freud) (Con)]

My Lords, over 2014, the UK saw the largest employment growth of any EU country. The UK continues to perform strongly, and over the past year, employment rose a further 350,000. This has gone alongside a welcome improvement in the rest of the EU, which saw an annual employment rise of 1.8 million.

[Baroness Stedman-Scott (Con)]

I thank the Minister for his response; I think that we will all be encouraged and pleased with the increase of employment levels across Europe. Can he tell us whether the recovery in employment rates across Europe will reduce inward EU migration into the UK?

[Lord Freud]

I think that it is a valuable development —to see improvement in the EU—because we have seen quite a large increase recently in the employment of EU nationals in the UK. Over the past year, for instance, it was 155,000, compared with 30,000 the previous year. So we would expect to see some of the pressure reduced, whereby people are pulled in because we have the jobs, as the jobs start to grow in the rest of the EU.

[Lord Pearson of Rannoch (UKIP)]

My Lords, is not the deeper point that the EU is in long-term economic decline? According to the IMF, the EU produced 30% of the world’s GDP in 1985, which will have fallen to 15% by 2020. So would not our employment prospects be much better if we got off the Titanic and traded freely with the markets of the future?

[Lord Freud]

I am not sure that the noble Lord has caught up with what has been happening in the world in the last year or so, when the developing world has fallen apart.

[Lord Fink (Con)]

My Lords, what has happened to the pernicious problem of structural unemployment during the time when overall employment has fallen?

[Lord Freud]

We have seen today a series of records on employment—but the most important part of those is how we are beginning to see real inroads among the people who have been excluded from the economic life of the country. The number of children in workless households and the number of workless households are the lowest on record, and the number of workless households in the social rented sector is the lowest on record. Lone parent employment is at a record high—and an important measure, economic inactivity, is now at the lowest rate since 1991.

[Baroness Symons of Vernham Dean (Lab)]

The Minister gave us the figures in raw terms as 350,000 in the UK and 1.8 million across the EU as a whole, but can he give us the figures as a percentage of the population of working age?

[Lord Freud]

I shall have to write to the noble Baroness, as that is quite a detailed question.

[Baroness Manzoor (LD)]

My Lords—

--- Later in debate ---

[Baroness Manzoor]

My Lords, women contribute significantly to the UK economy, both through paid and unpaid work. Yet despite 45 years of equality legislation, there remains a gender pay gap, particularly for women working in finance and the insurance sector, as well as for women aged over 40. I welcome the commitment of companies that are going to show the gender pay gap for men and women next year, but what will be done about the root causes of gender inequality? Most women are in low-paid work and there are limited levels of progression to better-quality, higher-paid work.

[Lord Freud]

Some of the statistics in this area are very interesting, in that among the younger generation the pay gap has disappeared. We will wait to see whether that goes on as that generation moves ahead. The most dramatic fact about female employment in this country is that the rate now stands at 69%, which is higher than the rate for the US for both men and women. That shows how far we have gone with female employment.

[Lord Wigley]

My Lords, is it not the case that the figures—understandably the Minister is boasting today about the high levels of employment—have taken place in the context of the UK being a member of the European Union? Is it not the case that, if the UK were unwise enough to leave that Union, these jobs would be put at jeopardy?

[Lord Freud]

My Lords, I am being bombarded with massive books of arguments about the economic effects, as are quite a lot of noble Lords, I imagine. I do not think there is time to go into the detail here.

[Lord Green of Deddington (CB)]

My Lords, does the Minister recognise that in the past five years only 37% of additional jobs—I choose my words carefully: “additional” jobs, not “new” jobs—have gone to the UK-born, while 39% went to EU-born people? At the same time, the youth unemployment rate in the UK has been stuck at 13%, twice the rate of that in Germany. There is no statistical correlation between those figures, but clearly there are jobs available. Will the Government therefore take further measures to help our own unemployed get into those jobs?

[Lord Freud]

In the past five years, 57% of new jobs went to UK nationals compared with 50% under the previous Government. One of the most dramatic figures I want to boast about is what has happened to youth employment. I have quoted again and again in this House the figure about workless youngsters not in education: it is now a million below what it was in 1997. It went right up under the previous Labour Government and is now at a low of 14.2%.

[Baroness Sherlock (Lab)]

My Lords, the employment rate for disabled people is now under 48%, leaving a disability gap of 30 percentage points. The Government have committed to halving that gap, which I welcome, but in the Committee on the welfare reform Bill this week there was support from every Bench of this House to require the Government in their new statutory reporting on employment specifically to report on progress on closing the disability employment gap. The Minister resisted that. Will he think again or, if not, will he tell the House why the Government are so resistant to that?

[Lord Freud]

This Government are going to produce a White Paper in the new year on how to support people who are disabled and pull them back into their rightful place at the economic heart of this country.