What has happened to public sector jobs?
Today’s public sector employment statistics give us an opportunity to stand back and look at what has happened over nearly five years – the last government’s stimulus and the current government’s austerity. Some of the accepted wisdom is completely wrong: it simply isn’t true that the whole public sector gained jobs during Labour’s last two years or that there are any public sector industries that haven’t lost jobs since the election.
Let’s start by looking at the big, overall picture. Excluding the banks that were nationalised, how many public sector jobs were added when the last government was raising public spending to fight off the recession?
To put that in numbers, at the end of 2009 – the peak of the stimulus – there were the equivalent of 4,953,000 full-time public sector workers (excluding the workers in the nationalised banks). That was 141,000 more than in the first quarter of 2008, just before the recession. Today’s figure of 4,601,000 is 352,000 below that peak – a reduction of 7.1 per cent.
The employment trajectory has varied from one part of the public sector to another. As the next chart shows, local government never really saw any jobs growth and employment in local authorities has fallen steadily since mid-2010. The growth was concentrated in central government, but not really in the civil service, where employment was pretty flat and then followed by an even sharper fall than we have seen in local government.
The increase in central government employment was targeted, not indiscriminate.
Ignore the ‘other public sector’ category, which is hopelessly inflated by employment in the nationalised banks. Contrary to current wisdom, employment in “public administration” actually fell; the big gainer was the NHS, with education and the other public services some way behind.
Another myth is that the NHS hasn’t been affected by the cuts (yet). In fact, the whole of central government employment has been hit:
Public spending cuts are already hitting employment across the sector. We know that a majority of job losses are still to come, with the Office for Budget Responsibility forecasting that general government employment will fall from 5.34 million in 2012/13 to 4.94 million in 2016/17. Workers desperately need a government that is thinking about policy After Austerity.