PEERING through the telescope of our fortunes, there seems little light after four years of a government spending slowdown, public sector job reduction and constraint on public sector pay. “Austerity” stretches on.
Confirmation on this comes today with a report claiming that, far from the loss of public sector jobs easing in the years ahead, the reduction is set to intensify and that the full pain has still to be felt. However, before we throw up our hands in total despair, there is another glass through which to look – and the view here offers a little more hope than the forecast from economist Dr John Philpott.
He expects a further 340,000 posts will be axed in the run-up to the next election – almost as many in the next two years as have already been lost since 2010. It is the debt burden that lies at the heart of this prolonged contraction in public sector employment and which continues to present the most difficult challenge for policymakers. Across the main parties there is a recognition that debt has to be reduced. Unfortunately, there is no painless way of doing this. We are faced with an unpleasant mix of tax increases and public spending reductions, whichever party is in charge.
The one glimmer of hope has been the surprising resilience of the labour market, and in particular the ability of the private sector to create sufficient jobs, not only to soak up those shaken out of the public sector but also to reduce the overall unemployment total. Over the past year, the number of private sector workers has jumped by 627,000, comfortably absorbing job losses in the public sector – while the number of public sector workers has dropped by 128,000. The Office for National Statistics reckons that 24 million people in Britain are now working in the private sector, the highest number since records began. All told, despite the squeeze on spending and a flatlining economy, there are now 29.6 million across the UK who are in employment – the highest number in history.
The issue for policy is how to accelerate the rate of private sector jobs growth so that further contraction in the public sector can be effected with the minimum of pain and disruption for the families and households affected.
In Scotland, there continue to be positive signs that the private sector labour market is continuing to improve. Latest Purchasing Managers Index data from the Bank of Scotland out today show that job creation strengthened in March and was the most marked in eight months.
Last month also saw the volume of new work at Scottish businesses increase for the fourth month in a row.
The imperative must remain to boost business creation and expansion, improve bank lending to the small firms sector and give every incentive and encouragement to business investment. It is a long slog. But it remains for now our best hope.
No repeating dangerous BBC ruse
How far should the BBC have gone in seeking to obtain television footage of life in North Korea – a highly repressive and dictatorial state whose leader has spent the last month making bellicose threats and warning the world of its preparedness for armed conflict?
Three students have now complained after they were effectively used as shields by the BBC when their university study trip to the country provided cover for a BBC documentary team. While the students were told beforehand, senior figures at the London School of Economics were unaware until last week that the BBC had used the ten-person party as cover for a Panorama film. Had the ruse been found out, the students could have found themselves held in solitary confinement in a North Korean prison.
Given the state of relations between North Korea and the outside world, this was without doubt a dangerous and potentially catastrophic gamble. The North Koreans would almost certainly have viewed the BBC as an adjunct of the British government and accused the UK of using the students for a spying mission.
The first concern of the university has to be the safety and well-being of its students. But there is also a secondary issue of considerable concern to universities: that this dangerous escapade could compromise future university study trips to other countries because of the suspicion that they may be providing cover for other parties and for other purposes, however high-minded. The university is right to raise the issue at the highest levels of the BBC.
And for their part, BBC governors must lay down clear and strict rules forbidding the use of third parties as shields in this way.