Birmingham has the highest unemployment rate in England: how the city compares to London & Manchester

Figures released by the Office for National Statistics today (Tuesday, May 16) show that unemployment rates rose in the January to March quarter.

BirminghamWorld has analysed these figures further and found that Birmingham now has the highest rate of unemployment in England and Wales - higher than cities including London and Manchester.

The unemployment rate in the UK has risen as companies continue to lay off workers and the jobs market declines The new data from ONS shows that the UK’s jobless rate rose to 3.9% in the January-March quarter - it was at 3.8% a month earlier.

However when we look at the unemployment rate for Birmingham - and the wider West Midlands the rate is much higher.

The latest figures show that Birmingham has 64,155 out-of-work claimants which represents 8.7% of the population. The number of out-of-work claimants has risen by 170 since last year.

Wolverhampton has the second highest rate of unemployment in England and Wales with 13,065 claimants which is 7.9% of the population.

By contrast Manchester has 24,425 out of work claimants, which represents 6.4% of the population - the tenth highest rate in England and Wales. There are 165 less people claiming out of work benefits in Manchester compared to last year.

The London borough of Haringey ranks as having the fifth highest rate of unemployment, with 12,900 out of work claimants which is 6.8% of the population with 650 more claimants compared to last year.

The gloomy picture is mirrored when we look at the wider areas, with the West Midlands ranking the highest for out of work claimants with 128,820 people - which is 7% of the population and 1,040 more claimants than last year.

Greater Manchester and Inner London have the same rate of unemployment with 5.2% of the population claiming out of work benefits.

In Greater Manchester there are 94,570 claimants, which is 5.2% of the population and 280 less people claiming compared to last Year. Inner London has 130,265 out of work claimants, which is 5,620 less than last year.

You can see a full comparison across the country here

The data indicates that the economy has lost momentum with high interest rates weighing on demand. The ONS report  also concludes  that the number of vacancies fell by 55,000 in the quarter to 1,083,000 in February-April. Another indication of a weakening labour market.

Data shows that firms have cut their payrolls by 136,000 in April to 29.8 million. The statistics  show that this is the first fall in total employees since the beginning of 2021. The ONS said on Twitter: “The number of employees on the payroll fell by 136,000 in April 2023, its first fall since February 2021.  It is now 838,000 above its pre #COVID19 pandemic level.”

The Greater Birmingham Chambers of Commerce has urged the Government to act decisively to drive economic growth. It has also recommended that more people should have access to apply for jobs where supply is short. Jobs currently on the shortage occupation list includes health services and day care work.

Raj Kandola, director of External Affairs at Greater Birmingham Chambers of Commerce, said: “This morning’s ONS figures revealed a mixed picture as the unemployment rate ticked upwards both regionally and nationally with the challenging economic landscape continuing to hamper businesses in their attempts to hire staff.

“It’s likely that rising interest rates are weighing heavily on demand as vacancies also fell across the majority of sectors this quarter – any minor uplift in the overall employment rate is likely to have been driven by a fall in the economic inactivity rate as more people are now looking for work compared to the end of last year.

“Here in the West Midlands, the unemployment rate remains the highest of any region in the country – a trend echoed in our own research as data from our last Quarterly Business Report highlighting the severe pressures local firms are facing in trying to add to their headcount.

“With the continued squeeze on pay packets, the Government will need to show its ability to act decisively in a bid to drive economic growth and ease labour market pressures – broadening access to the shortage occupation list would be a sensible start.”