'Olympics effect' boosts job market

The Olympic Games delivered a boost to Britain's jobs market after official figures showed another drop in unemployment as the part-time workforce soared.

The Office for National Statistics (ONS) said the jobless total fell by 7,000 to 2.59 million in the quarter to July - an unemployment rate of 8.1% - after a big jump in the number of people in work, with London one of the biggest gainers after hosting the Games.

But the so-called "Olympics effect" masked a less rosy picture outside London, with some regions suffering hefty rises in unemployment. And experts fear there could be an Olympics hangover now that the temporary boost from London 2012 is over.

Figures show that outside London, unemployment rose by 23,000 in Yorkshire and Humber in the three months to July and by 16,000 in the West Midlands. Northern Ireland was also badly affected, with 10,000 more jobless in the quarter.

The ONS figures revealed that London accounted for 91,000 of the 236,000 rise in the number of people in work in the quarter to July, which is the largest quarterly rise for two years.

The total number of people now in work stands at 29.6 million.

There was also a big fall in those claiming jobseeker's allowance, down 15,000 between July and August to 1.57 million - the largest monthly fall since June 2010. London accounted for 5,500 of the fall in the so-called claimant count, providing further evidence of an Olympics boost.

Other figures revealed the number of part-time workers leapt by 134,000 to reach 8.12 million - the highest since records began in 1992. The number of Britons working part-time because they could not find a full-time job also hit a record high of 1.42 million.

Samuel Tombs at Capital Economics said while the headline drop in unemployment was encouraging, the detail of the ONS report showed a "less impressive picture". He added that other recent employment surveys suggested many of those taken on for the Olympics "will struggle to find work now that the Games have finished".

Unison general secretary Dave Prentis said the Government needed a long term plan of job creation to ease the UK's economic woes. He said: "For families suffering the misery of unemployment, any decrease will be welcome news, but it is clear when you look at the bigger economic picture that any talk of growth is premature."