Unemployment down but debt fears remain

The new unemployment figures show that the numbers out of work have dropped to 2.47m, but there are still debt fears for the future.

According to the Office of National Statistics (ONS), the jobless rate is now down to 7.8 per cent, the lowest since January and 0.1 per cent below the forecasted figure.

However, some experts believe that unemployment may rise again soon. David Tinsley, formerly of the Bank of England stated that "it's hard to see how a steady... improvement will be maintained as public sector job losses start to bite."

Meanwhile, Capital Economics' Vicky Redwood doesn't think that the private sector gains will be able to offset the public sector losses.

The ONS also revealed that even those with jobs may still need to seek debt solutions, as earnings growth fell to 2.7 per cent, compared to the inflation rate of 3.2 per cent.

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