The TUC set out a plan in June for how we could create 1.24 million jobs in the next two years in the green industries of the future. But government investment needs to go beyond that: we need a plan for direct public sector job creation.
A public sector jobs drive will create decent, higher skilled and better paid work, and can help tackle the persistent race, class, gender, disability, regional and wider inequalities the UK has faced for decades.
We are calling for government to invest in 600,000 jobs in public services, including:
Overall, the TUC’s plan for jobs would deliver 1.85 million new jobs in the next two years. A fuller report [link] sets out the plan in more detail. Here, we summarise the economic context and lay out the details of the public service jobs drive.
The jobs crisis and the threat of mass unemployment
The Office for Budget Responsibility (OBR) projects unemployment rising to a total of between 3.3 and 4.5 million, an increase of up to 3 million from present levels. The chart below compares their ‘central scenario’ with episodes of mass unemployment over the past 100 years.
The scenario is striking for the showing the most rapid and severe increase in unemployment of the last century. And while the OBR predicts a rapid improvement relative to previous episodes, the TUC are concerned this scenario is too optimistic. The chart illustrates the Bank of England’s point that employment takes around seven years to return to its previous level.
Allowing unemployment to rise will create a vicious circle: reduced consumer spending power will weaken the economy, raising the risk of further unemployment. Under these conditions public sector spending is necessary to support the economy and revive the private sector.
A plan for public service jobs
Public sector workers have gone above and beyond to keep essential services going during the crisis. But they went into the crisis in a weakened position following a decade of cuts. The pandemic confirms that our collective safety and security relies on strong, resilient and properly staffed public services.
Health and Social Care
The government should create:
With applications down since the NHS bursary was scrapped and tuition fees were introduced, the government needs to do more to attract healthcare professionals to the sector, including further action on equality and inclusion.
The pandemic has exposed the disarray in adult social care provision, with large scale vacancies and immense future need. A national bargaining body should ensure dialogue between staff, employers and regulators on policy and good practice.
Local government is in crisis: UNISON reports the workforce has fallen by 240,000 (25 per cent) since 2010, affecting education, environmental services and social care. The government should create:
Over the past five years teacher numbers shrank by 3,500 and pupil numbers increased by 315,000. The government should create:
Proposed increases would restore the secondary pupil-teacher ratio to the level of 15.0, seen in the early 2010s, from 16.6 now, and begin improving the primary (and nursery) pupil-teacher ratio from the current level of 20.9 towards the OECD average of 15.0.
The government should protect the 30,000 jobs in higher education at risk from Covid-19.
With jobs under threat from a £2.5bn income shortfall from lost tuition fees and teaching grants under coronavirus, under the 'Fund the Future' campaign, the University and College Union are calling for no cuts to funding and staffing in higher education and further education.
The government should create 50,000 jobs in the Civil Service, halting all planned redundancies and outsourcing programmes.
Labour market inequalities
The UK labour market is already marked by persistent inequalities that leave those with protected characteristics, including women, BME groups, disabled people and LGBT+ people facing structural discrimination.
Previous recessions have served to exacerbate these inequalities. Alongside a jobs drive, the government must set out a plan for how it will ensure that job creation helps to tackle discrimination and inequality, and how it will meet its duties under the Public Sector Equality Act.
Putting jobs first is the best protection for the economy
Creating jobs in the public sector supports spending in the economy and revives private sector activity. The government’s spending on a jobs drive will be recouped by higher government revenues as the economy recovers and multiplier effects kick in.
Using standard average costings, the cost of increased public sector employment should not exceed £20 billion. The investment programme for green jobs has already been costed at 85bn over two years. These outlays would fall far short of the costs of mass unemployment.
For example the difference between the OBR best and worse-case scenarios is additional unemployment of 2 million. Our analysis of OBR cash estimates finds that the Treasury would lose out on £520bn in revenue over the next five years on the downside scenario relative to the upside.
The lesson of the UK’s economic history is that investment is the most effective way to deliver growth following a recession, and to restore public finances. We failed to learn this lesson in 2010 with devastating results. This time must be different.
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