Widespread rises in unemployment rates show the economic impact of COVID-19

The unemployment claimant count data (released 19th May) provides a strong indication of the early economic impacts of COVID-19. Released down to LSOA level, the data is of interest to those looking at supporting communities experiencing economic hardship as a result of the pandemic. 

The figures refer to the number and proportion of working-age people receiving benefits payable to those who are unemployed (economically active but out of work) as of 9th April 2020, compared with unemployment levels on 12th March 2020 (the last reference period before the UK went into lockdown).

 You can access the indicators on which the analysis is based through: 

  • Vulnerable communities data download: MSOA level data download freely available to everybody, which we are updating with any small area data that may help identify vulnerable communities and inform a response

The latest unemployment data is also available in Local Insight, our mapping and reporting platform with more than 1000 local level datasets for the areas you care about (whether that is towns, wards, constituencies or parishes).

Unemployment rises by more than one-third in every local authority and 20% see their unemployment rates double

The headline figures are striking, with the largest single monthly increase in recorded unemployment – 850,000 new claimants across the UK (an increase of 66%). This dwarfs the second largest increase in the last 25 years, which occurred during the global financial crisis of 2008/2009 – where unemployment rose by 177,000 across the UK (14%) between January and February 2009.

The increase is widespread, with every Local Authority in the UK seeing unemployment rise by more than one-third; and 76 of the 379 Local Authorities in the UK seeing their unemployment rate more than double in a single month.

Our initial analysis below focuses on the Local Authorities, towns and MSOA neighbourhoods which have experienced the largest increase in unemployment over the last month – identifying unemployment hotspots where people are more likely to be experiencing financial stress.

Local Authorities with seaside resorts see largest rise in unemployment rates

The data looks at the percentage point increase – calculated by subtracting the March unemployment rate from the April unemployment rate to get the change in the percentage of people receiving unemployment benefits between March and April – see here for more information about percentage point vs percentage change calculations.

The table below shows the 10 Local Authorities across the UK with the largest percentage point increases in unemployment between March and April 2020:

Local Authority Claimant rate March 2020 Claimant rate April 2020 Percentage point increase Mar-Apr 2020
Isles of Scilly 0.7 5.8 5.1
Blackpool 7.2 11.1 3.9
Torbay 3.5 7.1 3.6
Thanet 5.7 8.9 3.2
Tendring 4.6 7.7 3.1
Knowsley 4.8 7.9 3.1
Scarborough 2.9 6.0 3.1
Cornwall 2.7 5.8 3.1
North Devon 2.2 5.2 3.0
Torridge 2.3 5.2 2.9

 

Nine of these are located in Local Authorities containing seaside resorts – indicating the impact of COVID-19 on hospitality and tourism industries. 

This corresponds with the findings of the Business Impact of Coronavirus (COVID-19) Survey (BICS) conducted by ONS which reported higher rates of furloughing and job losses in accommodation and food services and arts entertainment and recreation industries.

At the other end of the spectrum, areas with a strong knowledge economy have been less impacted, with Cambridge seeing the smallest percentage point increase in unemployment 0.9. Again, this reflects the furloughing trends identified in the BICS.

Seven of the 10 towns with largest increases in unemployment are in Cornwall

Drilling down to settlement level, we can see that smaller seaside resorts dominate the list of areas that have seen the largest percentage point increases in unemployment.

Town Local Authority Claimant rate March 2020 Claimant rate April 2020 Percentage point increase Mar-Apr 2020
St Osyth Tendring 4.9 10.9 6
St Ives Cornwall 2.5 8.4 5.9
Padstow Cornwall 2.5 7.8 5.3
Flexbury Cornwall 4.4 9.6 5.2
Perranporth Cornwall 1.8 6.9 5.1
Newquay Cornwall 4.9 9.8 4.9
Looe Cornwall 3 7.8 4.8
Camelford Cornwall 3.9 8.6 4.7
Tenby Pembrokeshire 2.1 6.8 4.7
Fortuneswell Dorset 4.7 9 4.3

 

The table above shows the 10 settlements (villages, towns and cities) with the largest percentage point increases in unemployment between March and April. Seven of the 10 settlements experiencing the largest increases are found in Cornwall, and each of the 10 areas are coastal or located close to the coast – providing further evidence that coastal economies have been particularly badly affected by the pandemic.

Blackpool accounts for four of the top five MSOAs with highest levels of unemployment

Coastal areas now feature predominantly among the unemployment hotspots of the UK. The table below shows the 10 MSOAs/Intermediate Geographies with the highest overall unemployment rate (proportion of people receiving unemployment benefits):

MSOA/IG Local Authority Unemployment claimant rate April 2020 (%) Percentage point increase Mar-Apr 2020
Central Blackpool Blackpool 24.4 4.8
South Promenade & Seasiders Way Blackpool 23.8 5.6
North Shore Blackpool 22.5 6.4
Sparkbrook North Birmingham 19.3 3.7
North East Centre Blackpool 18.5 5.2
Skegness Town East Lindsey 17.9 3.5
Ayr N. Harbour, Wallacetown & Newton Sth South Ayrshire 17.6 3.2
Aston Park Birmingham 17.4 3.5
Lozells West Birmingham 17.3 2.3
Oldham Town North Oldham 16.1 4.6


Six of the 10 MSOAs with the highest levels of unemployment are in coastal areas.  Blackpool accounts for four of the top five areas, with just under one-in four people living in Central Blackpool now in receipt of unemployment benefits. Seventeen of the 20 MSOA neighbourhoods with the largest increases in unemployment over the period were found in coastal areas. 

However, the impact of unemployment is being widely felt across the country with every MSOA/Intermediate Geography neighbourhood in the UK seeing an increase in unemployment between March and April.