Ministers accused of ‘gaslighting British public’ over claim unemployed have ‘ample opportunities’ to work – business live | Business

Chancellor Jeremy Hunt and work and pensions secretary Mel Stride have been accused of “gaslighting the British public”, after claiming the unemployed have “ample opportunities” to find a job.

Hunt and Stride have written in the Times today that there’s no reason to be stuck on benefits.

The ministers wrote:

“We’ve been clear that unemployment benefits should only be there as a safety net, not a lifestyle choice. With around 900,000 vacancies in the economy there are ample opportunities for people to get on and get ahead in the world of work.”

Their comments come after the UK unemployment rate yesterday rose to 4.3% in the first quarter of this year, with the number of people out of work and looking for a job rising by 166,000 to 1,486m.

The number of vacancies fell to 898,000 and company payrolls shrank.

The number of people ‘economically inactive’ jumped to almost 9.4m, due to more people becoming temporarily sick, long-term sick, or retiring. The rise in sickness has been blamed on the long waits for treatment on the NHS, which prevent people getting back to work.

TUC General Secretary Paul Nowak says the government should focus on bringing down NHS waiting lists, rather than “punching down” by suggesting unemployment is a lifestyle choice.

Nowak tells us:

“Ministers are gaslighting the British public on the state of the UK labour market.

“Unemployment shot up by over 160,000 over the last quarter and record numbers of people are becoming economically inactive because they are too sick to work.

“Instead of punching down, the Tories should be tackling our sky-high waiting lists and improving access to treatment.

“And they should be laser-focused on improving the quality of work in this country.

“People need jobs they can build a live on. But under the Conservatives we have seen an explosion of low-paid and insecure work that has led to eye-watering levels of in-work poverty.

“Before handing out lectures, Jeremy Hunt and Mel Stride should try surviving on a zero-hours contract.”

Stephen Evans, chief executive at Learning and Work Institute, agrees that it’s wrong to suggest there is a widespread sicknote culture, or that unemployment benefits are a lifestyle choice for many.

Evans explains that more needs to be done to help people improve their skills, and access to the jobs market, saying:

“Many people who are out of work want to work, including 1.7 million who are economically inactive. But only one in ten out-of-work disabled people get help to find work each year and many people can’t find work that fits with caring responsibilities or health conditions.

It’s wrong to suggest that unemployment benefits are a lifestyle choice for many or that there’s a widespread sicknote culture. Rather, there’s not enough support to improve skills or find work and employers need to look at job design and terms and conditions to attract potential workers.”

In their Times article, Hunt and Stride write that the UK economy is doing “far better than many would have you believe”, after it emerged from recession last week, though they do concede there have been “bumps, twists and turns” in the economic recovery.

The London stock market received a boost this morning, with low-cost computing pioneer Raspberry Pi announcing it is considering floating here.

The Cambridge-based maker of low-cost computers, designed to help children learn to code, announced it is considering an initial public offering in London.

Eben Upton, CEO of Raspberry Pi, told the City:

“When we released our first product in 2012, our goal was to provide a computer that was affordable enough for young people to own and explore with confidence, giving them the chance to discover computing and get excited about it.

But from the very beginning we saw customers using our products in a staggering variety of applications across a broad swathe of markets, and as we recognised the potential for affordable technology to make a meaningful difference not just in education but in countless other contexts, the scale of our ambition grew. Twelve years later, we have sold over 60 million units in over 70 countries around the world.

Raspberry Pi really is a UK tech success story; created with the idea of providing a cheap, but powerful computer that made it easier to understand how computers worked.

The FT reports that the company hopes to seek a market valuation of about $630m (£500m).

If Raspberry Pi’s float does come off, it would show that the LSE can still attract companies, and help address the lack of exciting tech companies here in London.

Lorries carrying perishable food and plants from the EU are being held for up to 20 hours at the UK’s busiest Brexit border post as failures with the government’s IT systems delay imports entering Britain, my colleague Jack Simpson reports.

Businesses have described the government’s new border control checks as a “disaster” after IT outages led to lorries carrying meat, cheese and cut flowers being held for long periods, reducing the shelf life of their goods and prompting retailers to reject some orders.

The worst disruption was last weekend, with dozens of lorries being held at the government’s control post serving Dover and the Channel tunnel for periods of between eight and 20 hours after the IT system that registers goods went down.

More here.

It’s done it again!

The UK’s blue-chip share index has climbed to a new record high in early trading.

The FTSE 100 index jumped around 0.5% to a new intraday high of 8474 points, as investors hope that US inflation will fall today.

Experian, the credit data firm, are the top riser – up over 8% after it reported growth at “the top end of our expectations” for the last financial year.

In the City, profits at Burberry have dropped by 40% as the luxury goods market continues to struggle.

Burberry’s profits fell to £383m in the 12 months to the end of March, down from £634m a year earlier.

Revenues fell 4%, while profit margins also shrank.

Burberry reports that men’s and women’s ready-to-wear clothes sales were below average, but outerwear – such as its Heritage raincoats – were strong, while there was a double-digit increase in sales of scarves.

Jonathan Akeroyd, Burberry’s CEO, says that “executing our plan against a backdrop of slowing luxury demand has been challenging”, adding:

While our FY24 financial results underperformed our original expectations, we have made good progress refocusing our brand image, evolving our product and strengthening distribution while delivering operational improvements.

Back in January, Burberry issued a profit warning after weak Christmas trading.

And looking ahead today, Burberry cautions that the first half of the current financial year is expected to “remain challenging”.

It reports that sales in the Americas fell 12% last year. Sales in mainland China fell by 19% in the last quarter, but were up 2% over the year.

Sarah Riding, retail & supply chain partner at law firm Gowling WLG, says the retail market in general is “under the kosh at the moment”, adding:

“While Burberry’s results highlight a significant global reduction in sales and the subsequent fragility of the luxury market at present, there are still plenty of opportunities for those that have the supply chain ingenuity and ability to deliver against specific customer requirements in this space.

“Burberry has a proven track where this dynamic is concerned, given its aptitude in splitting its offering to suit key demographics that span demand for more obvious Burberry-led branding applies, while providing more subtle focused designs within its other lines – for example Thomas Burberry – thus, helping meet the need for quality and less obvious brand association at the same time

Global stock markets have climbed to a new record high today, ahead of the US inflation data due at 1.30pm UK time.

The MSCI All Country World Index, which tracks equities around the globe, nudged up to a new peak this morning, having closed at a record high last night.

That suggests optimism that today’s inflation report will show that underlying US inflation moderated last month.

Last night, the US tech-focused Nasdaq index closed at a record high; it’s gained around 10% so far this year.

There was also another flurry of meme stock excitement yesterday, with Gamestop surging 60%.

The UK’s stock market has helped with this rally – with the FTSE 100 hitting a series of record highs in recent weeks. The Footsie is up 9% since the start of January.

Jim Reid of Deutsche Bank reports that the markets turned more upbeat yesterday, telling clients:

The S&P 500 (+0.48%) closing within two tenths of a percent of its all-time high on March 28. Tech stocks outperformed, with the Magnificent 7 (+1.01%) reaching a new all-time high, led by Tesla (+3.29%) and Nvidia (+1.06%). But the equity rally was broad-based, with the small-cap Russell 2000 up +1.14%.

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

Hopes that America’s economy will achieve a ‘soft landing’ will be tested today by the latest US inflation data.

Investors across the globe are poised for April’s US CPI report, hoping to see signs that inflationary pressures are easing. But there’s also anxiety that price pressures are sticky, making it harder for the US Federal Reserve to lower interest rates soon.

Economists predict the annual US inflation rate will dip to 3.4% for April, after jumping unexpectedly to 3.5% in March.

On a monthly basis, prices are expected to have risen by 0.3%, a slowdown on March’s 0.4%.

Yesterday, Fed chair Jerome Powell pointed out that inflation has been falling more slowly than expected, despite US interest rates being raised to their highest in over two decades.

Powell told a conference in Amsterdam:

“We did not expect this to be a smooth road. But these [inflation readings] were higher than I think anybody expected.

“What that has told us is that we’ll need to be patient and let restrictive policy do its work.”

Investors are keenly awaiting the inflation data to gain a clearer understanding of when and to what extent the Fed might adjust interest rates, explains Fawad Razaqzada, market analyst at City Index and FOREX.com.

Razaqzada adds:

Persistent inflation in the first quarter, coupled with hawkish sentiments expressed by Fed officials advocating for prolonged high interest rates, have bolstered the US dollar.

However, recent developments such as weaker-than-anticipated US non-farm payrolls and an increase in jobless claims have fuelled speculation that the Fed might initiate interest rate cuts as early as September.

Core inflation, a key measure of underlying price trends, is forecast to slow to 3.6% per year, down from 3.8%.

Yesterday, we learned that US producers raised the prices by 0.5% in April, a faster increase than expected – but Wall Street shrugged that off, seemingly hopeful that today’s Consumer Price Inflation report will show prices easing.

The dollar has dropped to a one-month low against the euro this morning, ahead of the CPI data.

The agenda

• 10am BST: Second estimate of eurozone GDP in Q1 2024

• 10am BST: European Commission to release its spring economic forecasts

• 1.30pm BST: US inflation report for April

• 1.30pm BST: US retail sales report for April

• 3pm BST: UK Treasury Committee questions former Federal Reserve chair Ben Bernanke about the Bank of England’s forecasting