Unemployment rise: reaction - Telegraph The welcome increase in employment in the last three months was largely due to an increase in people becoming self employed, while the number of people in full time work fell. This highlights the importance for small businesses and the self employed to create new jobs. Cutting red tape and making it easier for people to acquire the right skills is vital. Carmen Watson, managing director of Pertemps Recruitment agency, said: Although there has been a boom in temporary employment over Christmas, this is the time when the greatest challenge will be presented to the job market as many industries enter a quieter period. Retail in particular has taken a battering at the start of the year with the failure of high street stores bringing about job losses. The key step to reviving the employment picture is focussing on enhancing skills and considering roles in industries where there is still a call for talented, hard working people. This will require a greater deal of flexibility on the part of applicants and an amenable, yet determined attitude. Jobs are still out there but in many situations they may be in areas you might not have thought of. Bernard Brown, partner and head of business services at KPMG, said: With the high street continuing to suffer in the wake of lukewarm consumer confidence, it's no surprise to see the job market continuing to contract. For a long time, though, temporary job placements have offered some form of salvation, so it's alarming to see these roles drying up, too. If permanent and temporary roles continue to disappear this is a trend that will go on for some time. It's easy for employers to retrench when times are tough, but if they are continually shelving jobs as a way of saving money, they will be in no position to capitalise when the economy turns a corner. It means that now is the time to start asking questions about how good a solution redundancy is. Charles Levy, senior economist at The Work Foundation, said: Those in work are also continuing to feel the squeeze as the economy substituted full-time work for part-time, permanent employment for temporary positions and employee jobs for often more precarious self-employment. This picture will only improve if we return to strong quarter on quarter employment growth. Nick O'Reilly, business recovery specialis at HW Fisher & Company, said: Inflation may be coming down, and the Bank of England breathing a little more easily, but on the high street it's as bleak as ever. The Christmas period saw several high profile retail names go to the wall, and now public sector redundancies are progressively kicking in. Once again, young people are feeling the pinch more than most. The unemployment rate for 16 to 24-year-olds is now the highest since comparable records began 20 years ago. The government has been careful to drip feed in the public sector cuts, and that has blunted the pain somewhat. But there's no escaping the uncomfortable truth - that the SME sector cannot, and will not, ride to the rescue of the newly jobless public sector workers. Martina Milburn, chief executive of The Prince's Trust, said: Britain's jobless generation are losing hope for the future. Unemployment can have a devastating effect - not just on future job and wage prospects, but also damaging wellbeing and mental health. Our research shows that unemployed young people are feeling less confident about the future than they did this time last year. The Government must work together with charities and employers on courses that are proven to help young people into jobs. Howard Archer, chief economist at IHS Global Insight, said: Latest labour market data are mixed, but overall they largely portray a troubling jobs situation and further marked deterioration seems very much on the cards given weakened economic activity, low business confidence and a number of recent surveys pointing to companies scaling back their employment plans. The claimant count measure showed unemployment rose by a modest 1,200 in December following an increase of just 200 in November. These are the smallest increases seen since claimant count unemployment started rising in February 2011, but it still took the level up to a 23-month high of 1.597m and it seems highly unlikely that this indicates a stabilisation in the labour market given the weak economic outlook and reduced business confidence. Soft overall labour market data and ongoing low earnings growth make further Quantitative Easing by the Bank of England in February seem ever more inevitable.