The Staggers

The New Statesman’s rolling politics blog

Osborne called it wrong on private sector employment

New figures show that the private sector isn't making up for public sector job losses.

By George Eaton Published 14 December 2011 13:25

New figures show that the private sector isn't making up for public sector job losses.{C}

In November 2010, George Osborne told the House of Commons that private sector job creation would "far outweigh" the job losses in the public sector. The Chancellor, an adherent of the theory of expansionary fiscal contraction, assumed that a bloated public sector was "crowding out" pirvate sector growth.

But today's employment figures tell a different story. Osborne's fiscal contraction has turned out to be, well, contractionary. In the last three months, 67,000 public sector jobs have been lost but just 5,000 private sector jobs have been created. The number of public sector jobs lost in the last year (276,000) now exceeds the number of private sector jobs created (262,000). As a result, unemployment has reached levels not seen for 17 years. There are now 2.64m people (8.3 per cent) out of work, including 1.03m young people. Youth unemployment is now 22 per cent, above the eurozone average of 21.4 per cent.

Over the course of this parliament, the Office for Budget Responsibility still expects private sector job creation to outweigh public sector job losses. By 2017, it forecasts that there will be 1.7 million more private sector jobs and 710,000 fewer public sector jobs. But given that the OBR has already had to raise its forecast for public sector job losses by 310,000, I wouldn't put too much faith in those figures. If the government wants to prevent unemployment hitting three million, it should call a halt to its job cuts now.

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Tags: unemployment George Osborne

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51 comments

Tue, 2011-12-27 16:20 — mike555

@Matt

"You haven't explained the nature of the inflation problem or the solution."

It is not my job to, though I will offer you my opinion if you answer some questions yourself.

"You also ducked out of telling me why the ECB raised interest rates, and subsequent actions."

It is not my job to explain that either, it's a laughable comment given that you haven't even explained your own posts.

Thu, 2011-12-22 17:54 — matthew fox (not verified)

Lol Bozo555, so your have appointed yourself as spokeperson, yet again?

The height of arrogance Bozo555, appointing yourself, you have an habit of doing so.

I am not surprised you can't justify your posts on inflation, they are all general rants about inflation, with no discussion of inflation problem and importantly the solution.

Tue, 2011-12-27 17:03 — matthew fox (not verified)

Oh yes it is you simpleton, your telling me, you have an opinion on inflation, but don't understand nature of the inflation problem or the solution, lol Bozo555, you are that thick.

I can give you the answer, because I understand the problem, it's not rocketscience dimwit.

Mon, 2011-12-19 22:39 — mike555

@Matt

"Inbrew, deprication of the currency will increase inflation, why don't you know that. "

Probably the only thing you've said I agree with assuming you meant "depreciation", so do you think keeping rates at all time lows for nearly 3 years (as I've argued against to much ridicule) is a good idea?

Sun, 2011-12-18 11:58 — Luddite (not verified)

Matthew fox. Just has David Cameron said to your great leader? "You shouldn't believe all you read in the papers” You are sounding awfully right-wing these days; you’ll be voting BNP next. It's this simple Matthew; you can't have more people taking out of the collective pot than you have putting in. It’s unsustainable; after all we all know how the Left-Green alliance loves sustainability at a time of plenty Labour didn't invest in the future. Labour didn't invest in skills. Labour didn't invest in industry. You’re wonderful but now totally economically discredited Labour government failed the very people that put the most faith in them. The public sector workers may think themselves a cut above the rest of us and look down on us ghastly working people who work in industry. The truth is for 13 years under a Labour government the genuine wealth creators got themselves hammered many lost their pensions many suffered pay-cuts and found themselves competing for jobs with low cost immigrants that you’re economically discredited Labour government allowed in on mass, but don't get me wrong most new arrivals I've had the pleasure of working with hold entrepreneurial hard working views on life and most particularly those from the former communist block hate socialism in all its manifestations. I wonder why?

Sun, 2011-12-18 12:48 — matthew fox (not verified)

Luddite, is being a nutcase fun?

Your sounding as stupid as ever Luddite.

How is it "Right Wing " to inform people that a devalued currency creates inflation.

I don't think for one minute you read the papers, somehow, I don't see you get past the cartoons or horoscopes.

I appreciate all that rust has killed most of your brain cells, but you lack economic knowledge is comically, like your knowledge of history, politics, geography, etc etc...

You do divide people, some think your a complete crackpot, others just a joke.

I'm agnostic on that issue, both camps make very strong case.

Tue, 2011-12-27 18:42 — mike555

@Matt

Like I said, all you need to do is explain your posts and you won't even do that. You expect me to explain the actions of the ECB yet you don't think you should explain your own posts?

Tue, 2011-12-27 18:54 — mike555

@Matt

Why won't you explain your own posts? Then I will answer, you can't expect everyone to answer all your questions without answering anything yourself.

Tue, 2011-12-27 19:25 — matthew fox (not verified)

How does that song go Bozo555?

Hahaha hehehe?

I don't work to your say so you fool, you are floundering, over the issue of inflation, passing over opportunity after opportunity to address it.

How much more time are you going to need, Brazil 2014?

Tue, 2011-12-27 22:02 — mike555

@Matt

Utterly dismal. No floundering from me, answer my questions and I will answer yours.

Wed, 2011-12-14 18:37 — Robert Taggart

So Gideo called it wrong... so did both his predecessors.
Oneself has no problem with unemployment... just with the political 'class' who keep putting up hurdles for us scroungers to jump over !
If only that 'class' could accept unemployment / benefits = a price worth paying !!

Fri, 2011-12-23 11:38 — mike555

@Matt

Nice question dodge again.

Fri, 2011-12-23 11:58 — mike555

@Matt

"The height of arrogance Bozo555, appointing yourself, you have an habit of doing so."

I haven't spoken for anyone, you're getting confused with me expressing an opinion.

"I am not surprised you can't justify your posts on inflation"

I have explained my posts, you have a long list of questions yet to answer. I surely can't be the only one to have noticed.

Fri, 2011-12-23 12:15 — matthew fox (not verified)

Keep up the pretence Bozo555.

You keep telling me what other people think of my and your comments, if that is not appointing yourself as a spokeperson, i don't want is.

No you haven't explained your posts on inflation at all, all we get is, inflation is too high, blah blah blah, end of story.

As usual you inflict remedial analysis, and for some strange reason you can't admit to being wrong.

I know you can't tell me, because you don't understand the nature of the inflation. Month in month out, you have miserable failed to explain your position.

Denial of the facts is what it is Bozo555, you keep forgetting that old bean.

Tue, 2011-12-20 12:15 — Anton Jury (not verified)

Everyone knew that from the very beginning!

George Osborne was just telling a pack of bare-faced lies.

Wed, 2011-12-28 11:46 — Indu Pendent (not verified)

@matt

Foxy, have you thought of getting your paws on a Kindle? No more headaches turning the pages. If you got a talking book it would also add to looking at the pictures.

The UK does not have an inflation problem. It has inflation but it has proven to be an asset. As we speak the BoE will be looking at how to stimulate inflation during 2012/3.

Inflation erodes the relative cost of wages in a suppressed Labour market. It makes people more competitive.

The negative aspects of QE is that it rewards bankers through their bonuses, leaks out of the economy through imports and does not provide a the theoretical kenysian stimulus to magically kick start the economy (its been tried and failed). It also prolongs the life of unsustainable businesses delaying recovery. That said, QE has a positive long term benefit of devaluing the currency which penalises imports and support exports. Inflation rises because imports become more expensive - its good inflation.

Foxy, do you have a view on the total planned £47Bn investment in Scotland over the next few years which will make Scotland the world's leading economy of green enegry? The £350Bn borrowed before 2008 but not invested was more than enough to make the UK a net exporter of sustainable energy. David Blanchflower support investment in green energy under the coalition. Instead under Labour the money was spent manipulating voters and propelling the Labour elite to power. Through the likes of you.

Fri, 2011-12-23 14:24 — mike555

@Matt

If you say so, you don't even explain your own posts so I hardly think you're in a position to comment.

Wed, 2011-12-14 19:42 — mcquade

"I actually heard a bozo refer back 20 years. Possibly the population has swelled a bit since?"

Which is why unemployment figures are given as a percentage if the population, both that bozos like Terrible but True would understand why.

Wed, 2011-12-14 19:46 — mcquade

"I actually heard a bozo refer back 20 years. Possibly the population has swelled a bit since?"

Which is why unemployment figures are given as a percentage if the population, not that bozos like Terrible but True would understand what theat means in comparative statistics.

Fri, 2011-12-23 19:20 — mike555

@Matt

"As usual you inflict remedial analysis, and for some strange reason you can't admit to being wrong. "

Because I haven't been wrong yet. Do you want me to remind you about your posts on the Trend in Real House Prices? Or your posts on Transport costs?

Fri, 2011-12-23 19:24 — mike555

@Matt

Here are the Trend in Real House Prices comments, I noticed how you disappeared from the thread when I explained what the figures you posted to ridicule my argument actually meant:

http://www.newstatesman.com/economy/2011/07/unemployment-crime-germany

Fri, 2011-12-23 22:13 — matthew fox (not verified)

Bozo555, news just in, you have never been wrong, really, are you super super sure?

Do I have to spell it out to you?

So back to my point, we seem to be strolling back down this well worn garden path.

Here is a selection of Bozo555, comments on inflation, note the really poor analysis.

http://www.newstatesman.com/economy/2011/05/easter-air-inflation-april

http://www.newstatesman.com/blogs/the-staggers/2011/10/highest-inflation...

Are you telling me I am missing the in depth analysis Bozo555?

Fri, 2011-12-23 22:24 — matthew fox (not verified)

http://www.newstatesman.com/blogs/the-staggers/2011/08/further-weale-qua...

http://www.newstatesman.com/economy/2011/09/cpi-inflation-rate-prices

Read these beauties Bozo555, 100% content free, no analysis.

Classic 24 carat gold comedy, just remind me why your never wrong.

Sat, 2011-12-17 11:51 — Nick (not verified)

He didn't 'call it wrong'. He never cared whether the private sector would pick up the slack or not. It was just a simplistic narrative he could feed the public as cover for the redundancies he was itching to visit on the public sector and their mainly unionised and pensioned workforce.

Sat, 2011-12-17 12:23 — enzee199 (not verified)

Osbourne was wrong from the very start...

the reason why is that talk of a distinct public and private sector is hopelessly out of touch with reality.

twenty years of new public management, outsoursing, tendering, privitising, partnerships with the third sector have blurred the boundary so much that even when jobs or services are funded by the public sector they are in fact provided by the private sector.

Worryingly Osbournes public/private black/white dichotomy was a mis-conception from the very start.

Simply put the public sector isn't in many cases very public.

Sun, 2011-12-18 19:12 — Hugh Markey (not verified)

Look, what can you expect from the bankers' errand boy?
How is Osborne any worse than Winnie Churchill( remember the Gold Standard), Selwyn LLoyd, Lord Barber, Barber's little helper John Major or Scot-Free Norman Lamont.
No we haven't forgotten Nigel Lawson or Geoffrey Howe - but George is the most popular chancellor in modern times.
Let's not rub it in.
( Some of our households are displaying a large photo poster of George Osborne. The expression is quizzical and a dialogue balloon asks - "Cold?". Bloody Freezing should bring a smile to his face )

Boer War Veteran

Tue, 2011-12-20 16:09 — matthew fox (not verified)

Bozo555, you are disagreeable don't worry old man.

Yes Bozo555, yes I did mean depreciation, thank you for correcting, it is shame your not big enough, when it the other way around, but such is life Bozo555.

I am surprised you understood the effect of depreciating a currency has on inflation, you finally got yourself off the daily sport website, and taken up reading?

Bravo old chap Bravo.

What is your next trick Bozo555, understanding the nature of the inflation problem, or is that way too much for you?

Sat, 2011-12-24 12:18 — mike555

@Matt

No answers again I see, so which bits are you saying I got wrong then?

Sat, 2011-12-24 12:22 — mike555

@Matt

You go on about people not admitting they're wrong. What are you thoughts on your comments about the Trend In Real House Prices, you know, the ones you used to try and ridicule my argument with?

Sat, 2011-12-24 20:25 — matthew fox (not verified)

Bozo555, again you fail to understand, what you have written. Time after time, you have totally ignored the nature of the inflation problem.

Time after time, you whine and complain without in anyway explain the nature of the inflation, and I do say so Bozo555.

Tue, 2011-12-20 20:26 — mike555

@Matt

Nice question dodge again I see. I've said I'll answer your questions just like I have in the past, but you must answer some yourself for a change.

Sun, 2011-12-25 12:21 — mike555

@Matt

So no answers, as usual, and you can't even tell me what I've got wrong then?

Sun, 2011-12-25 15:08 — matthew fox (not verified)

As usual your distancing yourself from the dross you write.

I will tell you what you have got wrong Bozo555, we are talking Janet and John terrority.

You complain about inflation, but fail to offer a solution, because you don't understand the inflation problem, yes Bozo555 it is that simple.

Fri, 2011-12-16 17:25 — matthew fox (not verified)

Inbrew, deprication of the currency will increase inflation, why don't you know that.

We have an inflation problem as it is Inbrew.

Why are you advocating the failed policy of George W Bush, he devalued the greenback and the presidency.

Mon, 2011-12-26 15:11 — mike555

@Matt

No I'm not, I've explained my posts to you, you on the other hand haven't.

Mon, 2011-12-26 16:55 — mike555

@Matt

"As usual your distancing yourself from the dross you write."

Laughable, have you explained your posts on the inflation thread yet? How many times have you avoided explaining them now?

Here's the link to help you:

http://www.newstatesman.com/economy/2011/12/consumer-prices-inflation

Wed, 2011-12-21 10:20 — matthew fox (not verified)

Sorry Bozo555, I couldn't help sniggering at your comment.

Do you want to go back through all the comments you have made on the NS website about inflation, over the last year, not once have you mentioned the nature of the inflation problem, why is that Bozo555?

Mon, 2011-12-26 22:36 — matthew fox (not verified)

Bozo555, I am not going to give you the answer, I warned you I am that not that gullible.

You haven't explained the nature of the inflation problem or the solution.

You also ducked out of telling me why the ECB raised interest rates, and subsequent actions.

It is shame you have failed miserable to answer, over this calendar year, the nature of the inflation problem.

At least you can redeem yourself in 2012, if you really want to Bozo555.

Wed, 2011-12-21 13:10 — mike555

@Matt

"Do you want to go back through all the comments you have made on the NS website about inflation, over the last year, not once have you mentioned the nature of the inflation problem, why is that Bozo555?"

I don't need to, it's not up to me to do so, I have actually said that QE would boost inflation. Nice question dodge again by the way.

Mon, 2011-12-19 05:26 — Colin Sloss (not verified)

It was funny seeing Mat's reply Yo Luddite but it is too easy, Independent, tho a fool, is better.

Fri, 2011-12-16 17:08 — Indu Pendent (not verified)

Good to see job shedding in the public sector is going well - it bodes will for the future. The public sector is still the recruiting heavily except the rate of recruitment has started to be slowed at last.

The 3.6% annual rate of improvement in relative pricing of UK workers is great news. Together with a decline of sterling will make UK people more competitive so we will sell more. At the momement UK people are too expensive to employ. There is no major spell of the socialist fairy which will fix this.

We need VAT to 25% like in Denmark to penalise imports whilst cutting national insurance and corporation tax to encourage investment.

Thu, 2011-12-15 21:07 — Luddite (not verified)

"New figures show that the private sector isn't making up for public sector job losses" That's not surprising the private sector don't care much for ex-government workers, most prefer to employ hard working foreigners.

Thu, 2011-12-15 21:27 — matthew fox (not verified)

Luddite supports the Government's Employment motto " British Unemployment for British Workers.

Luddite, why is Logica sacking 200 British workers?, they are going to be ex-private workers.

http://www.telegraph.co.uk/finance/newsbysector/mediatechnologyandteleco...

Wed, 2011-12-14 14:20 — Guy Debored (not verified)

Just like last time around it seems that the underlying aim of the exercise is to decimate expectation and subsequently drive down wages. Oh, and to divide and rule over any last vestiges of organised workers and collective bargaining.
Not that anyone of them would admit to that, or indeed engage with anything other than their party line.
Correct me if I'm wrong.

Wed, 2011-12-21 20:04 — matthew fox (not verified)

It is pantomime season Bozo555, " Oh yes it is "

You have every need to because you are a offer a solution ( very poor one by the way ) regarding to inflation.

Actually you haven't mentioned by how much inflation is increased through QE. Would you like to quantify your thoughts Bozo555, some how i get the feeling you don't know that answer either.

Wed, 2011-12-21 22:15 — mike555

@Matt

No answers again I see. You have every need to explain your own posts given the amount of ridicule you dish out.

"Actually you haven't mentioned by how much inflation is increased through QE"

No, it's not for me to guess an exact figure, however the BoE said in September that the first round of QE increased CPI by up to 1.5%, that's a big chunk of the inflation target in my book.

Over to you to answer a question for a change, I'm sure your lack of answers has not gone unnoticed by other readers.

Wed, 2011-12-14 14:56 — Terrible But True (not verified)

Intrigued at how the numbers get plucked and f...idlled with.

I actually heard a bozo refer back 20 years. Possibly the population has swelled a bit since?

And speaking of mostly income consumers vs. generators, was there not a bit of a 'spike' in the public sector tally for wee while?

Wed, 2011-12-14 15:30 — Hugh Markey (not verified)

Surely nobody believed the Tories or their Poster Boy. The Conservatives have always been the party and government which could provide mass unemployment at the drop of a hat.
Nothing startlingly new there. But somebody else's misfortune need not necessarily mean we all have to have join in the misery.
The Tatler's Party List is not all a load of balls. No double entendre intended, naturally.
Espied several female shoppers posing next to somebody else's Rolls having their photos taken outside the Ritz.
When that great democrat Churchill brought up the subject of individual freedom, somebody did say to the wartime PM - "Ah, you mean the freedom to dine at the Ritz!"

Virtual Reality

Tue, 2011-12-27 12:25 — mike555

@Matt

I'm not asking you to give me the answer, I've spent months answering your questions while you don't answer mine.

All I asked is you answer mine on the inflation thread, then I will answer your one question I have yet to answer, and you won't even do that. I think it's clear who runs from their posts.