What ‘cold-turkey’ will mean for jobs
A new report by PricewaterhouseCoopers predicts that the ‘private sector is set to go “cold turkey” and lose nearly half a million jobs’, as a result of the government’s savage spending cuts. With the report also estimating that a similar number of jobs will be lost in the public sector, PwC acknowledge that the cuts will slow economic recovery (albeit they fight shy of predicting a double-dip recession). You can read articles about the report here and here.
A key finding of the report is that PwC believe that the private sector will struggle to generate enough employment to offset the jobs cull which will follow in the wake of the cuts – PwC estimate that over the next four years the private sector will generate 600,000 less jobs than estimated by the OBR in June. This view is borne out by John Philpott at the CIPD. Speaking to the Times today (hence no link!) he comments,
“I would be surprised if you get what the OBR is looking at, which is essentially is strong private sector job gains.A strong automatic bounce-back is theoretically possible, but I can’t see it happening’.
The PWC comes hot on the heels of a warning from Nobel Prize winner Professor Christopher Pissarides, that the pace of the government’s cuts could create an unemployment crisis.
All of which chimes with the TUC’s repeated warnings that the pace and scale of the government’s cuts will result in ‘All Pain, No Gain’, and gives even more impetus to our call for coalition MP’s to ‘think again’ in advance of the CSR.