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The jobs crisis is worsening

The pace of public sector job cuts means that unemployment is certain to rise this week.

Jobs, jobs, jobs, is the refrain that will echo through Westminster this week. The latest figures are out on Wednesday and unemployment, which currently stands at 2.57m (8.1 per cent), the highest level since 1994, is expected to rise again, while youth unemployment, which currently stands at 991,000, is expected to top a million. The danger of a lost generation is increasing every month.

To add to the gloom, the Chartered Institute of Personnel and Development (CIPD) has warned that the labour market faces a "slow, painful, contraction" with firms delaying recruitment of more staff. Its quarterly poll of 1,000 private, public and voluntary organisations showed that employers in all three sectors intend to add fewer jobs in the coming months. CIPD public policy adviser Gerwyn Davies noted: "recruitment intentions are falling, which will make further rises in unemployment therefore seem inevitable given that public sector job losses are outpacing the predictions made by the Office for Budget Responsibility ... There is no immediate sign of UK labour market conditions improving in the short or medium term." Indeed, in the last quarter, the public sector shed 111,000 jobs, while the private sector created just 41,000.

Interviewed on the Today programme this morning, Mark Hoban, the Financial Secretary to the Treasury, sounded alarmingly complacent. As is now traditional, he began by emphasising the damage the eurozone crisis has done to the British economy ("The crisis in the eurozone casts a long shadow over our economy") ignoring the fact that the growth was falling and unemployment rising long before the current imbroglio. Asked how the government would stimulate growth, he could only point to long-term measures such as "better road networks, better energy infrastructure." Ministers have not adopted one of the pro-growth policies proposed earlier this month in the New Statesman by nine of the world's leading economists.

In times of economic crisis, the state has a duty to act as the employer of last resort but the CPID predicts that 610,000 public-sector jobs will be lost by 2016, 210,000 more than forecast by the Office for Budget Responsibility. For this reason, the CIPD, hardly a hotbed of radicalism, has called for the government to halt its public sector job cuts until the private sector has recovered. But that's a message to which George Osborne, besotted with austerity, remains tone deaf.

Tags: unemployment

26 comments

earlydawn's picture

@privet: Well it depends upon what you mean by "welfare fraud" and "benefit fraudsters" of course.
From the tone of your comment, I would infer that you mean that anyone who is claiming any sort of benefit is committing fraud against people who are paying in to the system. Whilst this is a perfectly reasonable (if somewhat self-centred) view, it seems a little uninformed.
For instance, "benefits" are not solely confined to those of working age not currently in employment. Indeed the money paid to them is not one of the largest expenses in the "benefit" payments system. (I believe that pensions and housing benefits are the largest - one is paid to people above the generally recognised working age and the other is also paid to people who very much are in work.)
That's why we still spent on "benefits" even during a period of Full Employment.

Stu's picture

@countmein

I agree..

The massive public sector of worthless jobs with no career development/prospects is one of the reasons why the deficit is so high. The Tories are trying to reverse this back down to manageable levels albeit in the worse period of all time. If they didn't the deficit would only accumulate even quicker.

So in this article it says the state has a duty to employ people. Wouldn't that mean more borrowing? we know what that leads to...

Luddite's picture

mike cobley: The workers are tired of carrying the public sector. "Unions and Strikes" What Unions? The overwhelming majority of union members are in the public sector. Go on strike see how much support you have. The only effective way a strike by the public-sector would have any effect would be to prevent workers in the private sector getting to work!! doesn't that tell you something..

p j wall's picture

This is now the narrative of the Nasty, Lying Tories, let`s blame everything on the Euro Zone and the Labour party?, All we need now is a bit of snow and BINGO!!, the Tories will have all their excuses til 2015!!, they are pathetic!, Gideon and Flashmans competence is non existant!, 18 months of non stop excuses, with another three years worth to come?, most of the UK domestic problems are solely down to the "Devil take the Hindmost" ideology of an increasingly out of touch, uncaring Tory party!, people are losing their jobs NOW!!, people have no jobs NOW!!, the Nasty party has been, and is putting people out of work with the presumption that the private sector would absorb all these job losses!, but yet again they`re way off the mark!, even though they were told this before hand!, and to those who say well they`ve got to cut spending, and it`s what they inherited, i bet you wouldn`t be saying that if it`s your job that`s lost?, and you would be pissed off if you heared it`s a price worth paying?, but what else should we expect from an out of touch bunch of Condescending Multi Millionaires like Gideon and Flashman!!, and their groupie apoligists on here?, Pathetic!!.

matthew fox's picture

Carrying the public sector. I mean people hate having to pay for Doctors, Nurses, street cleaners, dinner-ladies,firemen.

Luddite prefers the good old days, when the NHS had 1 million people on waiting lists.

matthew fox's picture

We have to borrow to fund all the JSA that is getting paid. How does the Exchequer benefit if people stop paying Income Tax and PAYE and have to live on benefits.

People forget, Public sector workers actually spend money which benefits the private sector.

Luddite's picture

The only role for the state is to create the environment for business to thrive. The state can't create sustainable jobs, have we learned nothing from this financial crisis.
"CIPD, hardly a hotbed of radicalism, has called for the government to halt its public sector job cuts until the private sector has recovered". So public sector jobs should be protected just like there pensions, and to hell with the rest of us, aren't you forgetting something... Such as who pays the bills? Or is our new public-sector aristocracy above the concerns of mice and men...

matthew fox's picture

With the private sector shedding jobs, Luddite is correct, Osborne has created an environment for business.

Raymond Denson's picture

Purchasing power earned by the workers is constantly extracted and shifted to the top by a number of mechanisms (Marx's surplus value, interest on mortgages, car loans, credit card debt, etc.) Governments attempt to replace this purchasing power to keep the system functioning,to ensure that the cycle of commodity production is maintained. To do this they get into debt. When attempts are made to reduce the deficit or eliminate it entirely, the system collapses, which is what is happening now.

Luddite's picture

Matthew fox: good morning.. but in your case it will be good afternoon.. Doctors, Nurses, I don't mind paying Doctors, but i do mind paying some £100.000 plus pension, as for nurses i wish some would show a little bit more compassion were our elderly are concerned. Fire brigade!! Matthew why are will still sending a 'whole' fire engine with full crew to a cat up a tree? when a man in a Ford Transit would do...

matthew fox's picture

Your not that bright are you Luddite.

The report your quote is criticising " Staff "

Last time I checked, Nurses do not cook, Nurses do not create menus, or do you know something I dont.

I am sure Nurses will appreciate you whole hearted support.

But I have a got a better idea, if you can do a better job, why don't you train as one?

Luddite's picture

matthew fox: What's the matter mate ran-out of cheap cider? The private sector can no longer carry this state baggage, and who ever said repairing the damage done by your economically discredited previous Labour government would be easy or painless. In the private sector, if you can't quantify your position you don't have a job. How many in the public sector can quantify their positions.. 1%.. Hard working people are getting tired of carrying unwanted baggage.. The state is to big and no longer affordable.

Luddite's picture

matthew fox; Hello what's the matter mate? aren't you my friend..
It's not me slagging-off some of our little angels it is independent inquiry after independent inquiry, and let's not forget it was Labour that destroyed NHS dentistry. "hate is the only emotion you can feel" Rage also 1%!! with Labour's appalling reckless incompetence when ever in government.

matthew fox's picture

I think Luddite access to the internet seems to be very limited.

Retail, Financial and Construction are all shedding jobs. The CBI issued a gloomy manufacturing report, the other week, heralding job losses in that sector.

Luddite's picture

matthew fox: With all these jobs loses in the private sector, it makes the cutting of the public pay-roll the more imperative..

matthew fox's picture

Come on Luddite, stop contradicting yourself, the private sector was the great hope, they where suppose to save the economy, now your telling me, we have to cut the public payroll to save the private sector.

What will tomorrow's argument be?

matthew fox's picture

Come on Luddite, why would I want to know you, imaginary friends have more substance they you.

Labour destroying NHS dentistry, Thatcher and Major decided to put 1 million people on the NHS waiting list, strange how you don't remember that fact.

Would you to name 3 independent enquiries that "Slag Off " Nurses?

swatantra nandanwar's picture

We've also got to keep unemployment and growth in perspective. Britain is in the same deep hole as the rest of Europe and America, and the solution isn't just in our hands. The rest of Europe and America will have to work together on this problem, otherwise its not going to be solved. We can't do it on our own.
Perhaps our politicians aren't up to it, ie imposing those savage measures, and we may have to go down the route of a technocratic Govt, like some other countries

swatantra nandanwar's picture

The phrase may well have appeared in the annals of some totalitarian regimes of the last century, like Germany and Russia. Or perhaps in Beveridge and Keynes?

CountMeIn's picture

"In times of economic crisis, the state has a duty to act as the employer of last resort,"

I don't know where this idea comes from. What sort of duty is it? Moral legal? Economic? What sort of jobs does it have a "duty" to create? Social workers? Equalities officers? Accountants?

mike cobley's picture

quoth Luddite "With all these jobs loses in the private sector, it makes the cutting of the public pay-roll the more imperative."

Bwah hahahahaha! Right, so let me get this straight - prosperity and growth depends on demand, so job losses means less people with disposable income, which means a drop in demand. And you're calling for more job losses, which will suppress demand still further, which will discourage private sector corps and investors from growing for the market. Bye bye growth, hello recession.

Sheesh, whose side are you on?

swatantra nandanwar's picture

Did you notice the Govt offered the Public Sector workers a 15 min comfort break and keep their days wages, instead of the full scale Day of Action on 30 Nov. I think the Workers told Dave where he could put his proposal.
People have the wrong idea about Unions and strikes; its not only jobs they are concerned about; its investing in the future and the generation to come.

matthew fox's picture

Luddite, in your case it is good riddance.

Your the last person to lecture anyone on compassion, you haven't got a kind thought in that empty head of yours.

I appreciate being a conservative, hate is the only emotion you can feel.

Robert Taggart's picture

Jobs crisis ? YIPEE !
Beggars belief that the political class continues to give us health benefits scroungers so much grief.
They try to coerce us on to work related benefits (ESA, JSA), but, WHAT WORK ?!

Privet's picture

'In times of economic crisis, the state has a duty to act as the employer of last resort'

Great idea! i totally agree, but where is the surplus to fund this jobs creation program..? ooops i forgot Labour spent it all , no surplus no safety net

Many Economists classify the period of 1997-2007 in the UK as having full employment, so can someone explain why we spent x 100 billion on welfare? many genuine but many benefit fraudsters

Deficit deniers

Welfare fraud deniers

I suppose the world is flat & we didnt have a holocaust either

Luddite's picture

Matthew fox: I was only taking the piss!!! "Labour destroying HNS dentistry" Mmmm.. Try finding a decent NHS dentist these days after Labour's disastrous dental reforms of the 1990s!!!
Patient Association, The care Quality commission. Here's just one quote!!

The Care Quality Commission carried out unannounced visits at 100 hospitals to assess dignity and nutrition standards.

It identified concerns in 55 cases, describing the findings as "alarming".

Common areas of concern included a lack of support for those who needed help eating, poor hygiene and curtains not being closed properly.

Health Secretary Andrew Lansley said he would encourage whistle-blowers to highlight any concerns they had about the standard of hospital care for the elderly.

He said: "We expect that staff across the NHS, if they see examples of poor care they blow the whistle on that, which is precisely why we have introduced changes to the staff contract."

The inspections were ordered by Mr Lansley after several highly critical reports by campaigners, including the Patients Association.

The 100 sites inspected - representing more than a third of the total number in England - were chosen through a combination of random selection and because previous research had flagged up concerns about standards. Like i said 1% it's not be slagging-off our wonderful little angels..

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