Today's employment figures make grim reading for the government. Total unemployment now stands at 2.57m, the highest level since 1994, while the unemployment rate is now 8.1 per cent, the highest level since 1996. Worse, youth unemployment rose by 74,000 to 991,000 (21.3 per cent), just short of the symbolic million mark and the highest level since comparable records began in 1992. The danger of a lost generation is increasing every month. Since it came to power, the coalition has scrapped the Future Jobs Fund (described by Frank Field, the government's poverty adviser, as "one of the most precious things the last government was involved in"), abolished the Education Maintenance Allowance (EMA) and announced that it will offer 10,000 fewer university places next year. All measures that have exacerbated the jobs crisis.
And worse could be to come. George Osborne promised that private-sector job creation would "far outweigh" the job losses in the public-sector but few now believe him. Earlier this week, the Chartered Institute of Personnel and Development [CIPD] warned that 610,000 public-sector jobs would be lost by 2016 (200,000 more than forecast by the Office for Budget Responsibility) and urged the government to call a halt to its job cuts.
The ONS didn't publish new figures on public and private sector employment this month but last month's bulletin showed that while 264,000 private-sector jobs have been created over the last year, 240,000 public-sector jobs have been lost, a net gain of just 24,000 jobs. Worse, over the quarter, 111,000 public-sector jobs were lost, while just 41,000 private-sector jobs were created, suggesting that the labour market is beginning to stagnate.
The CIPD estimates that every public-sector job that is lost costs the state around £8,000-£10,000 in benefits and taxes forgone. Osborne, who has already been forced to announce an extra £44.4bn of borrowing due to lower tax revenues and higher welfare payments, will find it ever harder to reduce the deficit as unemployment continues to rise. As the self-defeating nature of austerity becomes clear, the pressure for a change of course will become even greater.