US created 38,000 jobs in May vs. 162,000 expected. 

Investors’ reactions to Friday’s anaemic employment numbers in the U.S. — the worst labor report since September 2010. The timing of the release meant that Asian and European markets didn’t really get to respond. The question, as ever, is whether the Fed will now wait to raise rates again, and what the implications for currencies are. The dollar plunged against major currencies after the release.

According to the Washington Post: The U.S. job market slowed dramatically in May, according to government data released Friday, adding just 38,000 jobs despite other signs that the economy was picking up steam after a weak start to the year.

Job growth in May was the weakest since 2010, when the country was still clawing back from the Great Recession and thousands of workers were joining the ranks of the unemployed. The Labor Department also lowered its estimate of hiring in March and April by 59,000 jobs.

In addition, the unemployment rate fell from 5 percent to 4.7 percent. However, the decline was primarily due to a contraction in the labor force, rather than workers finding jobs.

“This just does not square with all the other things we’re seeing in the economy,” said Gus Faucher, chief economist at PNC Financial Services Group. “This is no reason to panic, and I still think the fundamentals remain solid.”

Estimates of overall economic growth this spring range from 2.5 percent to 3 percent, substantially higher than the 0.8 percent pace this winter as the slowdown in China, plunging oil prices and a strong dollar crimped exports and business investment and rattled financial markets around the globe. The United States' recovery appears to have pulled through the turmoil, but the disappointing jobs report suggests it was left with some scars.

Ruth Davidson is under pressure to prove that her party is within the mainstream of Scottish politics by abandoning her defence of the UK Government’s welfare cuts – and to put the interests of people in Scotland ahead of the interests of David Cameron and George Osborne. 

Ahead of a debate on social security and disability benefits in the Scottish Parliament next week, the Tory leader has been challenged to back a new approach to social security from the Scottish Government, which puts dignity and respect for individuals at its heart, and to make clear that her group of MSPs does not support the approach of the DWP on issues like the Bedroom Tax, sanctions and disability cuts.  Commenting, SNP MSP Clare Adamson said:“Ruth Davidson faces a very clear choice in the Scottish Parliament next week.  

She can back a new and better approach to social security with respect and dignity for individuals at its heart – or she can continue to back the flawed and deeply unfair approach favoured by her party south of the border. “Tory welfare cuts have caused misery for vulnerable people in communities across Scotland – which is why the SNP in government will take a different approach with the powers which are being transferred to Scotland.

Ruth Elizabeth Davidson (born 10 November 1978) is a Scottish politician. She is the leader of the Scottish Conservative and Unionist Party, the second woman to lead the party, and the Member of the Scottish Parliament for Edinburgh Central.

A ban on wearing headscarves in the workplace may be admissible if it is based on a general company rule prohibiting political, philosophical and religious symbols from being worn visibly, an advisor to the EU's highest court has said.

In an opinion on a case brought by a Muslim woman fired by Belgian security company G4S, advocate general Juliane Kokott said that there was no direct discrimination on the grounds of religion if the ban was founded on a general rule, and not on stereotypes or prejudices against one or more religions, or against religious beliefs in general. Read more on out-law.com. 

In November 2015 the OECD projected growth of 2.39% for UK GDP in 2016 and 2.26% for 2017 – it has now revised these down to just 1.7% for 2016 and 1.96% for 2017.
  

The OECD Global Economic Outlook released today. The global economy is stuck in a low-growth trap that will require more coordinated and comprehensive use of fiscal, monetary and structural policies to move to a higher growth path and ensure that promises are kept to both young and old, according to the OECD.

The UK economy has been effective in creating jobs since the recession. Unemployment is low relative to other countries and total employment is at an all-time high. But productivity growth has been low, and this is reflected in low wage growth putting lower-income households at risk of poverty.

The UK government is committed to balancing the budget in the medium term, aiming to achieve an absolute surplus by 2018/19. The main opposition party (Labour) are also committed to reducing the deficit, but more slowly. In that context, the UK government has embarked on an ambitious programme of reform of the benefits systems, aiming simplify the system, align incentives and reduce costs. The Coalition aims to achieve this through spending cuts, rather than tax rises. This focus on spending cuts is one of the key drivers of reductions in social security spending, although the government would also argue that they are reforming systems to improve incentives and fairness. Some areas of government spending (e.g. health and education) have been protected from cuts, meaning that very large reductions are required elsewhere.

In the UK, the average income of the richest 10% is almost 10 times as large as for the poorest 10%.

The OECD average is 9.5, in France and Germany it is around 7 and in the US 16.

Between 2005 and 2011 the average income of the poorest 10% in the United Kingdom fell 2% in real terms.

While the average household income in the UK is slightly lower than in Germany and France, the average income of the bottom 10% in the UK is much lower.

The share of the top 1% of income earners increased from 6.7 % in 1981 to 12.9% in 2011. At the same time, the top marginal income tax rate saw a marked decline: dropping from 60% in the 1980s to 45% today.

The level of income inequality among the total population in the United Kingdom has been well above the OECD average in the last three decades. From a peak in 2000 and subsequent fall, it rose again since 2005. Recent data up to fiscal year 2012/13 suggests inequality has been constant since 2010. 

Taxes and benefits reduce income inequality by a quarter in the UK. This is in line with the OECD average, but below other European countries such as France, Germany or the Nordics. 

Changes in taxes and benefits combined have reduced household income on average in the UK since 2007. The reduction has not been as large as in Ireland, Portugal, Iceland and Spain, but on the other hand, in United States, Germany, Estonia and France, tax-benefit changes increased household incomes over the same period. While in other countries income tax changes played an important role, in the UK fiscal consolidation was driven mainly by changes in benefits. 

Families earning around the average wage tended to gain, particularly due to the increase in the income tax basic allowance. The impact on families in unemployment and with low earnings was dependent on the family composition: Families without children tended to lose, mainly due to changes in housing benefits. Families with children tended to gain through the rise in the child tax credit. Policy changes also reduced the income of higher earnings families due to the withdrawal of child benefit and higher social contributions.

Benefits system ‘a cruel bureaucracy’, says Ken Loach after Cannes win

In a Guardian article, the director Ken Loach has said he does not want David Cameron to watch his latest film, which deals with unemployment, poverty and the rise of food banks in Britain today, because punishing the poor is part of the prime minister’s project.

Last week, Loach became the first British director to win the Palme d’Or at Cannes twice, when his welfare state polemic I, Daniel Blake picked up the prize.

The 79-year-old film-maker had previously announced he was finished with directing but became so infuriated by the plight of the poor under the current Conservative government that he came out of retirement to make a new film, addressing the human cost of their policies.

A scene from the heart wrenching film - iDaniel

The Europeant jobless rate was stable at 10.2 percent in April, the same as March. But beware of averages because the discrepancies are huge. In Germany, the unemployment rate is 4.2 percent; in Greece, 24.2 percent.

At the beginning of 2000, above 20 million persons were unemployed in the EU-28, corresponding to 9.2 % of the total labour force. The unemployment trend at that moment was downwards. In the second quarter of 2001 the number of unemployment persons had dropped to 19.6 million and the unemployment rate to 8.7 %. A long period of increasing unemployment followed. At the end of 2004 the number of jobseekers available for work reached 21.1 million, while the unemployment rate was 9.2 %.

At the beginning of 2005 a period of steadily declining unemployment started, lasting until the first quarter 2008. At that time, EU-28 unemployment hit a low of 16.1 million persons (equivalent to a rate of 6.8 %) before rising sharply in the wake of the economic crisis. Between the second quarter 2008 and mid-2010 the unemployment level went up by more than 6.6 million, taking the rate up to 9.7 %, at that time the highest value recorded since the start of the series in 2000. The decline of unemployment in the following three quarters was a deceptive sign of an end of the crisis and of a stable improvement in labour market conditions in the EU-28. In fact, since the second quarter 2011 and until the first quarter of 2013 unemployment steadily and markedly increased taking it to the record level of 26.4 million, corresponding to a record rate of 10.9 %. Since then the rate has started to decrease, reaching 9.9 % at the end of 2014.

The unemployment rate in the euro area (EA-18) followed roughly the same trend as in the EU-28. However, between 2000 and the beginning of 2004 the unemployment rate in the euro area was below that recorded in the EU-28. This pattern was subsequently reversed as, between 2005 and the beginning of 2008, unemployment declined more rapidly in the Member States which do not yet have the euro. As in the EU-28, during the economic crisis unemployment increased at a considerable pace, with the exception of the period between mid-2010 and mid-2011 where it temporarily declined. The unemployment level peaked at 19.2 million in the second quarter of 2013, before going down in the second part of 2013 and in the course of 2014.

In 2000, the unemployment rate in the United States was around 4 %, considerably lower than in the EU. It remained much lower until early 2008, when unemployment started to increase rapidly. By the beginning of 2009 the unemployment rate in the United States had reached the same level as in the EU-28, and stayed above the EU-28 rate until the beginning of 2010. Since then the US unemployment rate has followed a downwards path which has taken it to 5.7 % at the end of 2014. In Japan, between 2000 and 2014, unemployment rates were much lower than in the EU, ranging between 3.5 % in the fourth quarter 2014 and 5.4 % in the third quarter 2009, when the rate started declining.

Youth unemployment trends

Youth unemployment rates are generally much higher, even double or more than double, than unemployment rates for all ages. As for the rate for the total population, the youth unemployment rate in the EU-28 sharply declined between 2005 and 2007, reaching its minimum value (15.2 %) in the first quarter 2008. The economic crisis, however, severely hit the young. From the second quarter of 2008, the youth unemployment rate has taken an upward trend peaking in 23.8 % in the first quarter 2013, before receding to 21.4 % at the end of 2014. The EU-28 youth unemployment rate was systematically higher than in the euro area between 2000 and mid-2007. Since then and until the third quarter 2010 these two rates were very close. Afterwards the indicator moved more sharply in the EA-18 than in the EU-28, first downwards until mid-2011, then upwards until the end of 2012 (see also Figure 5). In the middle of 2012 the euro area youth unemployment rate overtook the EU-28 rate, and the gap increased until the end of the year. The gap became even larger in the second part of 2013 and during 2014, when the rate for the euro area went down less than the rate for the EU-28.

High youth unemployment rates do reflect the difficulties faced by young people in finding jobs. However, this does not necessarily mean that the group of unemployed persons aged between 15 and 24 is large, as many young people are studying full-time and are therefore neither working nor looking for a job (so they are not part of the labour force which is used as the denominator for calculating the unemployment rate). For this reason, youth unemployment ratios are also calculated, according to a somewhat different concept: the unemployment ratio calculates the share of unemployed for the whole population. Table 1 shows that youth unemployment ratios in the EU are much lower than youth unemployment rates; they have however also risen since 2008 due to the effects of the crisis on the labour market.

Male and female unemployment trends

Historically, women have been more affected by unemployment than men. In 2000, the unemployment rate for women in the EU-28 was around 10 %, while the rate for men was below 8 %. By the end of 2002, this gender gaphad narrowed to around 1.5 percentage points and between 2002 and mid-2007 this gap remained more or less constant. Since the first quarter of 2008, when they were at their lowest levels of 6.3 % and 7.4 % respectively, the male and female unemployment rates in the EU-28 converged, and by the second quarter of 2009 the male unemployment rate was higher. The decline of the men’s rate during 2010 and the first half of 2011 and the corresponding stability in the women’s rate over the same period brought the male rate below the female one once again. Since then the two rates have risen at the same pace until mid-2013, when they reached their highest value, both at 10.9 %. In the second half of 2013 as well as during the course of 2014 both the male and the female rates declined, reaching respectively 9.8 % and 10.1 % at the end of 2014.

A detailed look at 2014

The overall unemployment rate in the EU-28 reached 10.2 % in 2014, decrease of 0.7 percentage points compared with 2013. This follows an increase of 0.4 percentage points between 2012 and 2013. In the United States the unemployment rate fell for the fourth year in a row, from 7.4 % in 2013 to 6.2 % in 2014.

The unemployment rate rose in 6 Member States between 2013 and 2014, dropped in 19 and remained stable in France, Croatia and Luxembourg. The increases in the annual average unemployment rates between 2013 and 2014 were recorded in Italy (+0.6 ppt), Finland (+0.5 ppt), Cyprus and Austria (both +0.2 ppt) as well as in Belgium and the Netherlands (both +0.1 ppt). The highest decreases were reported in Hungary (-2.5 ppt), Portugal (-2.3 ppt), Ireland (-1.8 ppt), Spain and Bulgaria (both -1.6 ppt) and the United Kingdom (-1.5 ppt). With 26.5 %, Greece was the country with the highest overall unemployment rate in 2014. The dispersion of unemployment across the EU-28 remained at approximately the same level as in 2013.

Long-term unemployment is one of the main concerns of policymakers. Apart from its financial and social effects on personal life, long-term unemployment negatively affects social cohesion and, ultimately, may hinder economic growth. In total, 5.1 % of the labour force in the EU-28 in 2014 had been unemployed for more than one year; more than half of these, 3.1 % of the labour force, had been unemployed for more than two years. Compared to 2013, a decrease is observed in the long term unemployment (from 5.2 %) while a sizeable increase (from 2.9 %) is registered among those being unemployed for two or more years.

For the first time since the calculation of EU-28 unemployment statistics started (in 2000), the unemployment rate for women was lower than that for men in 2009, and remained so in 2010. In 2011, this effect reversed again, with female unemployment rates at 9.7 % against 9.6 % for males. The gap has remained unchanged until 2013, when the two rates for the EU-28 peaked at 10.8 % for men and 10.9 % for women. In the euro area the rate has always been higher for women than for men. In 2014 the rates stood at 11.5 % for men and at 11.8 % for women. Male unemployment rates were higher than the corresponding rates for women during 2014 in 15 out of 28 Member States. The gap between male and female unemployment rates varied from -6.5 percentage points in Greece to +3.5 percentage points in Ireland.

The youth unemployment rate in the EU-28 was more than double the overall unemployment rate in 2014. At 22.2 %, more than one out of every five young persons in the labour force was not employed, but looking and available for a job. In the euro area, the youth unemployment rate was even higher at 23.8 %. The unemployment rate among young persons was higher than the rate for those aged between 25 and 74 in all Member States. In Spain (53.2 %), Greece (52.4 %), Croatia (45.5 %), Italy (42.7 %), Cyprus (35.9 %) and Portugal (34.7 %) youth unemployment rates were particularly high. Germany (7.7 %) was the only Member State with a youth unemployment rate below 10 %.

Educational qualifications are still the best insurance against unemployment, which clearly increases the lower the level of education attained. The average unemployment rate in the EU-28 for those aged between 25 and 64 having attained at most a lower secondary education was 18.2 %, much higher than the rate of unemployment for those that had obtained a tertiary education qualification (6.6 %).

Currently

Eurostat estimates that 21.224 million men and women in the EU-28, of whom 16.420 million were in the euro area  were unemployed in April 2016. Compared with March 2016, the number of persons unemployed decreased by 106 000 in the EU-28 and by 63 000 in the euro area. Compared with April 2015, unemployment fell by 2 096 000 in the EU-28 and by 1 309 000 in the euro area.

The euro area seasonally-adjusted unemployment rate was 10.2 % in April 2016, stable compared with March 2016, and down from 11.0 % in April 2015. The EU-28 unemployment rate was 8.7 % in April 2016, down from 8.8 % in March 2016, and from 9.6 % in April 2015.

Among the Member States, the lowest unemployment rates in April 2016 were recorded in the Czech Republic (4.1 %), Germany(4.2 %) and Malta (4.3 %). The highest rates have been observed in Greece (24.2 % in February 2016) and Spain (20.1 %).

Compared with a year ago, the unemployment rate in April 2016 fell in twenty-five Member States, remained stable in Belgium and increased in Estonia (from 6.7 % in March 2015 to 6.8 % in March 2016 ) and Latvia (from 9.5 % to 9.6 % ). The largest decreases were registered in Cyprus (from 15.7 % to 11.6 %), Bulgaria (from 10.0 % to 7.1 %) and Spain (22.7 % to 20.1 % ) .

In April 2016, the unemployment rate in the United States was 5.0 %, stable compared with March 2016, and down from 5.4 % in April 2015.

In April 2016, 4.235 million young persons (under 25) were unemployed in the EU-28, of whom 2.932 million were in the euro area. Compared with April 2015, youth unemployment decreased by 495 000 in the EU-28 and by 261 000 in the euro area. In April 2016, the youth unemployment rate was 18.8 % in the EU-28 and 21.1 % in the euro area, compared with 20.7 % and 22.5 % respectively in April 2015. In April 2016, the lowest rates were observed in Germany (7.0 %), Malta (8.9 % and the Czech Republic (9.5 %), and the highest in Greece (51.4 % in February 2016), Spain (45.0 %), Croatia (38.9 % in the first quarter 2016) and Italy (36.9 %).

Senator Bacik’s Competition (Amendment) Bill stems from a longstanding Labour Party commitment to ensure protection of the right to collectively bargain for freelance workers, including journalists, actors and others who perform their work on a self-employed or contract for services basis.

Welcoming the passage of the Bill through second stage back in January, Senator Bacik said then:

“This Bill will allow self-employed workers, such as actors or journalists, who personally provide work or perform services, to collectively bargain with their employers. However, it would ensure consumers remain protected from illegal price-fixing. It is great to see it pass through second stage.”

In the same spirit, Senator Bacik welcomed the Labour Motion for the protection of workers’ rights to be debated in the Dáil this week

With the roll-out of the full Universal Credit service finally starting Wednesday 25th May – it is being rolled out to five jobcentres including Bath and Newcastle Cathedral Square, with more to follow in the coming months and years – the Resolution Foundation is calling on the government to make a number of reforms to ensure the success of the policy.

By 2020 Universal Credit will be the second largest component of welfare spending – amounting to £53 billion a year – and almost half of all families with children will be entitled to it at any given point.

Analysis by the Resolution Foundation, which considers the impact of UC alongside the new National Living Wage and increases in the Personal Tax Allowance, found that around 2.5 million working households will be worse off by an average of £41 a week, while around 2 million households will be better off by an average of £34 a week.

It also finds that recent cuts to work allowances in UC had particularly reduced work incentives for single parents and second earners in couples, both of whom are particularly sensitive to financial incentives to work.

David Finch, Senior Economic Analyst at the Resolution Foundation, said: “After years of delay, the full Universal Credit service will finally become a reality as it is rolled out across selected Jobcentres from today.

“Universal Credit is in many ways an improvement on the current system, and some families will be better off. But it also has serious design flaws that need to be addressed before it has been fully implemented.

“The weakened rewards for entering work and earning more are particularly worrying, especially for single parents and second earners who are normally sensitive to such incentives.

“Improving these work incentives will help Universal Credit to boost employment, tackle low pay and make the government’s welfare reform more female-friendly.”

Labour Dublin West Deputy Joan Burton has welcomed the CSO’s latest Quarterly National Household Survey figures which show that in April unemployment dropped to 7.9%.

But she warned that there can be no room for complacency in particular, as regards, more vulnerable unemployed groups including the long-term unemployed, older unemployed people and younger early school leavers.

Deputy Burton commented, “It is very encouraging to see that the comprehensive jobs policies that the previous government put in place continue to drive unemployment down - now below the milestone 8% mark.  

"In the first quarter of the year, unemployment was its lowest since 2008. This means there has now been 14 consecutive quarters of employment growth. The CSO figures also show that 12 of the 14 sectors across the economy experienced annual employment growth.

“In addition, the numbers of people employed is now just below the 2 million mark and it’s estimated we will break this hugely significant threshold in Q2.

"This means that the level of employment is at its highest level since the first quarter of 2009 and is another sign of the success of the Action Plan for Jobs and the Pathways to Work programmes.

“But there is no room for complacency in this regard. In particular, we must make sure that people who are long-term unemployed, young early school leavers and older people who have lost their jobs and are finding it harder to get back into the workforce are given absolute priority in job creation programmes and all necessary training supports.

"Some older people who have been made unemployed have described how they have in effect been forced into an unwanted "early retirement" as they are finding it very difficult to get back in to the workforce.  

“Younger early school leavers are also a group that are especially vulnerable to unemployment and targeted supports for this group must be at the forefront of current job creation policies.

"Supporting more vulnerable unemployed people is absolutely vital to ensure a broad-based recovery were unemployment does not become entrenched in certain age cohorts or areas of the country.

"It will also be critical for ensuring a broadly-based and lasting economic recovery."

A set of economic indicators released this week show clearly why the Welsh Government needs to adopt a new economic strategy, Plaid Cymru’s Shadow Finance and Economy Minister Adam Price has said.

Figures released by the Office of National Statistics show that Gross Disposable Household Income (GDHI) per head in Wales is now at its lowest level since 2002 compared to the rest of the UK, 14.8% lower than the UK average.

GVA figures show that Welsh workers continue to earn nearly £100 per week less than the UK average.

Figures also show that no other part of the UK is more reliant on benefits and pensions for household incomes than Wales, with a total of 24.1% of the income of the people in Wales reliant on this form of income.