According to a new report published by the Chartered Institute of Personnel and Development (CIPD), the answer is yes – unemployment will rise to 2.85 million next year, with the number of people in work falling by 120,000.

The CIPD predicts the number of people out of work will hit its highest level since 1994, and the figure will continue rising until it peaks at 2.9 million in the first half of 2013.

If the forecasts for next year are accurate, this will be the first time unemployment has reached 2.85 million and still been increasing since 1991.

It is expected that unemployment will remain above 2.5 million until 2015 as a result of feeble economic growth.

The report doesn’t forecast any change to the figures for long-term and youth unemployment, and cited Government efforts to get these 2 groups into work.

The report also predicted that productivity would continue to stutter and that caps on pay would remain ‘severe’.

Dr John Philpott, chief economic adviser at the CIPD, said

“The combination of worsening job shortages for people without work, mounting job insecurity and a further fall in real earnings for those in work may test the resilience and resolve of the UK workforce far more than it did in the recession of 2008-9.”

He even speculated that this could “foster a tetchy passive-aggressive mood in many workplaces that could prove very hard to manage.”

Shadow work and pensions minister Ian Austin said “it is crystal clear that this government is failing to get people off benefits and into work.”

However, a spokeswoman for the DWP said “the increase in those claiming Jobseeker’s Allowance has slowed and our welfare reforms are having a positive impact with overall benefit claimant numbers falling by around 40,000 in the last 18 months.”

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