Scrapping employers NI could be just the job for the long-term unemployed

Wednesday 22 October 2014

Latest employment figures show that the number of people unemployed in the UK fell below 2.0 million for the first time since 2008. However, the headline figures fail to show the devastating impact on those that find themselves unemployed over the long term.

Scrapping employers NI could be just the job for the long-term unemployed

Saga’s latest analysis clearly shows that any movement in the number of long-term unemployed is very much age dependent. Figures for the number of younger people classed as being in long term unemployment are dropping rapidly, which may be as a result of recently announced changes to Employer’s National Insurance for employees under the age of 21.  However, the fact that similar reliefs were not provided for other age groups may account for the fact that many over 50s, who find themselves jobless find it significantly harder to get back into the workplace. 


Saga’s Paul Green commented “We believe that abolishing Employer’s National Insurance for a period of time when taking on those who are long-term unemployed would have a positive impact on unemployment rates across all age groups. Actively encouraging employers to look again at those who, often through no fault of their own, have been cast onto the employment scrap-heap could not only help people get back into work, it could help ensure businesses don’t lose waste a wealth of experience.”

Key Points


  • The number of people classed as long-term unemployed in the UK has dropped over the last 12 months to 711,000 in the three months to August 2014, a fall of 194,000 people from the same period a year ago.
  • The reduction is much in line with the wider fall in unemployment experienced over the last 12 months. As such, the percentage of all unemployed people that are classed as long-run unemployed remains at 36.1%, identical to the proportion recorded at the same point a year ago.
  • The number of over 50’s who have been unemployed for over 12 months has declined at a slower rate than for other age groups. Whilst the number of those aged 16-49 classed as long-term unemployed has fallen by 23.0% from a year ago, the number of over 50’s classed who have been unemployed for over 12 months declined year-on-year by a less pronounced 15.9% to 164,000 in the three months to August 2014.
  • As a result it has taken longer for the number of long-run unemployed in the over 50’s age group to return to the level recorded in the three months to May 2010, the beginning of the current government.
  • The 16-49 age bracket fell below this benchmark in the three months to April 2014 and as of the three months to August 2014 there are 84,000 fewer long-run unemployed in this age group.
  • The over 50’s age group only dropped below the May 2010 benchmark in the three months to August 2014, with 6,000 fewer people in long-term unemployment than in the three months to May 2010. 




Data analysed by cebr using latest available ONS data

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