Revealed: Scottish unemployment almost three times the official figure

Sunday, 28 May, 2006

THE true figure for unemployment in Scotland is 250,000 - almost three times the official number - according to a groundbreaking report.

Research conducted by one of Britain's leading authorities on the welfare state claims there are 160,000 "hidden unemployed" in Scotland, many of them forced on to sickness benefits through lack of work.

They outnumber by almost two to one the official unemployment claimant count of 88,000. The 160,000 make up around half of the total number of Scots presently on incapacity benefit, the GBP 78 a week payment given to those who are deemed too ill or disabled to be required to look for work.

However, the report says this group, largely made up of less skilled workers, women and older workers, should be counted as among the unemployed, arguing that they are capable of working and, in a more vigorous economy, would have nothing to stop them finding a job.

The report was written by Professor Steve Fothergill from Sheffield Hallam University for Scottish Enterprise, Scotland's job creation agency. Fothergill rejects claims that those on incapacity benefit are "malingerers", arguing that people on the payment do have genuine health problems. However, he insists that they are not so unwell as to be prevented from working.

"What has happened is that in the competition for jobs, less healthy workers, many of whom are also older and less well qualified, have lost out," he says.

"Sometimes they were the workers made redundant in the great wave of job losses that affected industries such as coal, steel and heavy engineering. Sometimes they lost out indirectly as the ex-miners and ex-steelworkers took jobs that would have gone to other men and women in the local area."

Consequently, such people have slid on to incapacity benefit, which offers a more generous and longer-term income than other forms of support.

He adds: "Where jobs are in plentiful supply, as in parts of southern England, many people with health problems and disabilities do continue to work and employers can't afford to be so fussy."

Fothergill's research works out the numbers of hidden unemployed by benchmarking the number of people on sickness benefits in individual areas against the figures in other regions where there is near full employment. It also factors in regional trends of genuine illness to estimate how many people on sickness benefit are genuinely incapable of keeping a job.

By far the largest number of hidden unemployed in Scotland were found in Glasgow. Fothergill estimates that some 39,100 incapacity benefit claimants could work, and should therefore be on the official unemployment register. The figure represents 10 per cent of the entire working age population of the city.

The figures come as ministers consult on a welfare reform green paper which is expected to propose major changes to the sickness benefit system in Britain. The government is also extending a 'Pathways to Work' pilot scheme designed to encourage those on incapacity benefit to find jobs.

Responding to the claims of hidden unemployment, Scotland Office minister David Cairns said: "There is nothing hidden about it. Through the Pathways to Work scheme and the Welfare Reform green paper we are focusing all our efforts on getting these people back to work."

David Ruffley, the shadow minister for welfare reform, said: "It is all very well the government telling IB claimants about all the support they can get, but there are too few jobs to go around, particularly in unemployment black spots."

A spokesman for the Department for Work and Pensions said: "We are committed to ensuring that people, where possible, do not spend a lifetime on incapacity benefit and we are working towards giving people the support and training they need to have fair access to the labour market."