National inputs also ‘seriously flawed’

Official measures of GDP are said to be ‘seriously flawed’

Now, a report by the OECD (Organisation for Economic Co-operation and Development) and the Centre for Cities think tank claims ‘millions more people are unemployed than official statistics suggest’

Worse still: “The joblessness rate could be three times higher than thought” because some three million people who are able and keen to work are being excluded from the register by being classified as economically inactive i.e. not in work, nor looking for work

The official unemployment rate     =      Total number of people out of work

Total economically active population

Given the current official UK unemployment total is at an apparent record low of 1.3 million (4.6%), then adding  another 3 miilion somewhat spoils this government claim, increasing the unemployment rate to 13.2%

The report thus calls on the government to increase investment in skills for people who have been out of the labour market for a long time – albeit without saying by how much and in what skills

In response, the ONS (Office for National Statistics) which produces the official unemployment statistics said:

  • Its headline figures are based on internationally agreed definitions
  • If they were widened, it would stop being a measure of spare employment capacity (i.e. precisely what the 3m are)



  • With the above huge discrepancy bewteen the official and actual unemployed figures, one can only wonder about the validity of the ONS’s official national (labour) input and so productivity statistics produced each quarter
  • National GDP output measurement is already said to be ‘seriously flawed’
  • Now, the same seems to apply to national labour inputs


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