Fudge
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Posts posted by Fudge
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Quotes from the Guardian story
"Osborne said last week that his newly appointed panel of outside experts – the Office for Budget Responsibility – believed the jobless rate would soon start to improve. "The unemployment rate is forecast by the Office for Budget Responsibility to peak this year at 8.1% and then fall for each of the next four years, to reach 6.1% in 2015," he said. This forecast was fleshed out in the Treasury's Red Book, which says: "The decline in employment appears to be coming to an end and we expect a modest recovery in employment in the second half of 2010."
From next year, officials believe that stronger growth and a rising working population will lead to an acceleration in jobs growth. Over the five-year period from 2010 to 2015, the Treasury assumes that employment will rise from 28.8m this year to 30.1m in 2015, despite the loss of jobs caused by spending cuts."
I'd love to know what the figures for growth are based on. Apart from crossed fingers.
I've had a look at the Red Book http://www.hm-treasury.gov.uk/junebudget_easyread.htm and particularly the bits about how the Government intends to help businesses.
However, I can't find anything anywhere that says what the OBR and the Treasury are basing their forecasts on. Where do they expect the additional jobs to be created? Retail? Manufacturing? Of what? For sale to whom? Services? Providing what? To whom? Where will the customers be getting their money from?
Ahhh I know what they have done. They realized that cutting the deficit would put 1.3m out of work and cutting unemployment/incapacity/housing/child benefits would force 1.2m onto the jobs market. So they said we need 2.5m jobs to be created in the private sector. So thats what they are forecasting. Simples innit.
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The reason the Labour government created so many jobs in the public and indirectly in the private sector is because the private sector couldnt or wouldnt.
Especially in Scotland, Wales and up North.
The reason so many people are on unemployment and/or incapacity benefit is again because the private sector did not create suitable jobs.
Most of the jobs the private sector does create are low paid casual time jobs that only Eastern European workers can afford to do.
So this idea the private sector is going to create 2.5m jobs just like that is nonsense. Osborne knows it, Cameron knows it and everyone else deep down knows it to.
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Budget will cost 1.3m jobs - Treasury
Exclusive: Leaked government data concerning next five years shows hidden costs of austerity drive
* Larry Elliott, economics editor
* guardian.co.uk, Tuesday 29 June 2010 21.02 BST
* Article history
Chancellor of the exchequer George Osborne holds Disraeli's original budget box Chancellor of the exchequer George Osborne holds Disraeli's original budget box. Photograph: Peter Macdiarmid/Getty Images
George Osborne's austerity budget will result in the loss of up to 1.3m jobs across the economy over the next five years according to a private Treasury assessment of the planned spending cuts, the Guardian has learned.
Unpublished estimates of the impact of the biggest squeeze on public spending since the second world war show that the government is expecting between 500,000 and 600,000 jobs go in the public sector and between 600,000 and 700,000 to disappear in the private sector by 2015.
The chancellor gave no hint last week about the likely effect of his emergency measures on the labour market, although he would have had access to the forecasts traditionally prepared for ministers and senior civil servants in the days leading up to a budget or pre-budget report.
A slide from the final version of a presentation for last week's budget – seen by the Guardian – says: "100-120,000 public sector jobs and 120-140,000 private sector jobs assumed to be lost per annum for five years through cuts".
The job losses in the public sector will result from the 25% inflation-adjusted reduction in Whitehall spending over the next five years, while the private sector will be affected both through the loss of government contracts and from the knock-on impact of lower public spending.
The Treasury is assuming that growth in the private sector will create 2.5m jobs in the next five years to compensate for the spending squeeze. Osborne said in last week's speech that tackling Britain's record peacetime budget deficit would help keep interest rates low and boost job creation. "Some have suggested that there is a choice between dealing with our debts and going for growth. That is a false choice".
However, investors are increasingly nervous about the lack of growth in the world economy. The FTSE-100 fell more than 3% today as fresh jitters hit confidence.
The opposition and trade unions said the unpublished Treasury forecasts backed up their argument that the unprecedented scale of the cuts in public spending would hamper Britain's recovery from the deepest and longest recession since the Great Depression.
Alistair Darling, the shadow chancellor, said: "Far from being open and honest, as George Osborne put it, he failed to tell the country there would be very substantial job losses as a result of his budget.
"The Tories did not have to take these measures. They chose to take them. They are not only a real risk to the recovery but hundreds of thousands of people will pay the price for the poor judgement of the Conservatives, fully supported by the Liberal Democrats. It shows the risks they are prepared to take. If they get it wrong, those people losing their jobs will not get back to work."
Osborne said last week that his newly appointed panel of outside experts – the Office for Budget Responsibility – believed the jobless rate would soon start to improve. "The unemployment rate is forecast by the Office for Budget Responsibility to peak this year at 8.1% and then fall for each of the next four years, to reach 6.1% in 2015."
This forecast was fleshed out in the Treasury's Red Book, which says: "The decline in employment appears to be coming to an end and we expect a modest recovery in employment in the second half of 2010."
From next year, officials believe stronger growth and a rising working population will lead to an acceleration in jobs growth. Over the five-year period from 2010 to 2015, the Treasury assumes that employment will rise from 28.8m this year to 30.1m in 2015, despite the loss of jobs caused by spending cuts.
The TUC general secretary, Brendan Barber, said: "With Treasury figures revealing that spending cuts will hit private sector jobs harder than those in the public sector, it is absurd to think that the private sector will create 2.5m new jobs over the next five years.
"This is not so much wishful thinking as a complete refusal to engage with reality. Much more likely are dole queues comparable to the 1980s, a new deep north-south divide and widespread poverty as the budget's benefit cuts start to bite. Many will find that a frightening prospect."
John Philpott, chief economist at the Chartered Institute for Personnel and Development, said: "There is not a hope in hell's chance of this happening [the creation of 2.5m new jobs]. There would have to be extraordinarily strong private sector employment growth in a …much less conducive economic environment than it was during the boom."
The CIPD has estimated that there will be 725,000 jobs lost in the public sector alone by 2015, although Philpott said the number could be lower if the government succeeded in pushing through pay cuts.
He added that Osborne was expecting a similar rise in employment over the next five years to that seen during 13 years of the last Labour government, when around a third of the employment growth came from the public sector. "This is a slower growth environment and there will be no contribution from the public sector."
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Maybe the numbers indicate that we never came out of recession?
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It is the same in the uk. This is why the economy is in crises and why we are in a recession.
People had to get into massive debt to live a good standard of living because wages had been depressed over the last 30 years under
Thatcher and Reagans neo liberal policies.
So people struggle to pay off their debts, banks run into trouble and the government has to bail them out and to cut the deficit we are told
we have to sacrifice the welfare state.Really what it all boils down to is we are having to resort to drastic measures in order to keep the Capitalist
system going. A system that benefits the few at the cost of the many.
That is why there are riots in Greece and at the G20 in Canada.
Why are people propping up a system that is screwing them over?
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Haha an Etonian millionaire preaching the world doesnt owe you a living.
Its all coming out now. The Tories cant help themselves as each day goes buy they show a little bit more of their real nature.
Get on you bikes for work, disabled people are lazy scroungers.
Give it a couple of weeks and they will blame black single mothers for the banking crises.
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I spent a busy day today, but got little done. This is because I am at last becoming perfect in the art of seeming busy, even when very little is going on in my head or under my hands. This is an art which every man learns, if he does not intend to work himself to death.
* Robertson Davies, in The Table Talk of Samuel Marchbanks
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The first generation of immigrants are always the most hardworking and industrious.
They have often come from real poverty and hardship and given the opportunity they will work 24/7 to improve their lives.
But the second and third generations onwards tend to take things easier and dont work any differently to indigenous folk.
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The Tories instinctively dislike the immigrants and would love to stop them coming in completely but they want the cheap labour
that they provide for their businesses. So they compromise they employ cheap labour in their businesses but they can afford to live
in a gated community or a country village apart from communities where the poor live.
It reminds me of victorian times when the circles that the well of mixed in, the houses, communities and streets were all well maintained and
well publicly funded but you only had to turn off your route into a side street and you would see real poverty.
So rich people could live amongst poor people but never see it.
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I give this ConLib government 18 months max.
When the economy goes back into recession and the impact of the public services and welfare cuts are felt and the private sector are losing jobs
instead of creating them.
Cameron, Osbourne and Clegg wont look so clever.
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Stop misleading people over public sector, warns UNISON
The Policy Exchange report comparing pay and conditions in the public and private sector are “misleading and meaningless” warned UNISON, the UK’s leading public service union today (18 June).
Dave Prentis, General Secretary of UNISON, said:
“There are fundamental flaws in this report. The report’s comparisons between public and private sector workers’ pay are meaningless – they are not comparing like with like.
“A whole swathe of low paid workers such as school cooks, cleaners and NHS porters are now employed by private companies. Overwhelmingly the lowest paid workers are always the ones contracted out to private companies and this artificially lifts the private sector average.
“These figures have been further distorted by the inclusion of employees of nationalised banks in public sector earnings statistics. In the public sector no one can expect to earn the telephone numbers that some people in the private sector get paid.
“In addition a higher proportion of public sector employees are now professionals or graduates – for example one in five is a teacher. The Office for National Statistics reveals in its labour force survey that 8.6% of private employees are graded as professionals, whereas these form 24.5% of public employees.”
“The report also claims that public sector employees work shorter hours than private sector workers - again entirely misleading – the statistical difference arises from the fact that there are more part-time jobs in the public sector than in the private, most of them performed by women –such as care assistants, teaching assistants and hospital meals providers.
“And when it comes to pensions, in Local Government more than half the pensions are less than £3,000 per annum and the average pension paid to women is only £2,800 per annum. In the NHS Pension Scheme, more than half of women pensioners receive a pension of less than £3,500 per annum.
“It’s time to stop pitting public workers against private and start thinking about what is best for the whole country. We need public sector workers at work helping those in the private and public sector get through this recession.”
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Its not fair that the BP oil spill affected the gulf of mexico.
They should spill oil everywhere then it would be fair.
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Mercillessly taken from El Reg
Foxconn – the massive Taiwan-based contract manufacturer whose clients include Apple, Dell, HP, Intel, Sony, and others – will shutter its mainland China operations in a restructuring that could move as many as 800,000 workers into the ranks of the unemployed.
This news comes by way of the Chinese-language news site ON.CC — a Google translation is available here — and couldn't immediately be independently verified.
The announcement came at a shareholders meeting of the Hon Hai Group, Foxconn's parent company. Chairman Terry Gou said that production would be withdrawn from mainland China and shifted to Taiwan, Vietnam, and India. There are currently 800,000 Foxconn workers on the mainland, and if all Foxconn manufacturing there eventually ceases, they would all be out of work.
Foxconn has been under fire recently for a series of suicides at its Shenzhen, China factory. Gou said that the Chinese government had sent 200 inspectors to the plant, which employs somewhere between 270,000 (Financial Times) and 400,000 (Steve Jobs) workers, and that Foxconn management had been exonerated.
Guo also said that the ongoing rash of suicides could be of the copy-cat variety, fueled by media coverage. He also noted that the company had suspended death benefits to remove that impetus for jumping, the favored method of suicide not only at Foxconn's Shenzhen plant, but in urban China in general.
In another bid to improve conditions at its mainland Chinese factories, Foxconn announced two substantial pay raises: a 30 per cent across-the-board raise announced last week, and a 66 per cent performance-based raise to go into effect in October.
According to ABC News the company provided no details on how performance would be evaluated. ®
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Is this the beginning of the end of cheap Chinese labour & hence cheap goods from China?
Looks pretty inflationary as far as consumer goods go.
See "Chinese labour unrest spreads" http://www.ft.com/cms/s/0/28c02300-7381-11df-ae73-00144feabdc0.html?ftcamp=rss
See also http://news.bbc.co.uk/2/hi/business/10271559.stm
It's ironic that a trade union "Solidarity" brought about the beginning of the end of communism in Eastern Europe. No doubt the Chinese communist party will do everything not to let trade unions get out of hand in China. It makes one wonder what the Western media will say if the Chinese use the army against striking workers to protect the economic interests of Western companies in China?
I said this would happen the other day in another thread.
Workers in places like China and India will need to organise for better wages and conditions like has been done in the UK and USA in the past.
Companies will move production to countries with even cheaper labour like Vietnam and those workers will need to organise for better wages and conditions and so on.
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With much of the UK total debt being owned externally, I wonder if the house price boom and subsequent recession were really caused by trade imbalances. Some countries (e.g UK) just kept importing more than they exported for many years, the money used just came back into the housing markets and other loans, artificially labelled as AAA super safe. Trade doesn't seem to be much of a financial media issue in the current crisis as far as I can see.
Funny really that by buying an excess of foreign products, the money is lent back to us again to buy more foreign products and simultaneously make our houses more expensive via bank leverage.
Until trade is balanced (via much lower real wages), I think the debt can only be shifted back and forth between the public and private sectors. An austerity plan that doesn't result in rebalancing trade will just cause a permanent downward spiral IMHO.
So an austerity plan really needs to be a lower-real-wage plan (disguised for minimum public acceptance and why no one will ever vote for it).
Another funny thing is that by bailing out the worst banks, we missed a big chance to stiff a lot of external creditors (where the risk belonged) and instead, dump it fully on the UK taxpayers.
Your thoughts please.
VMR.
Trade inbalances are a big factor.
But mainly it was globalisation that has kept wages down here and in the US which was the reason people and countries got into so much debt in order to maintain their standard of living.
Without the economic boom which was mainly down to the housing bubble economic growth over the last 10 years would have been very weak
and there would have been much resistance to globalisation including the offshoring of jobs.
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Not to mention prices go up pushing up wages more .. where's this leading?
Fudge, whilst I have some sympathy with your belief I just don't see it. Our standard of living comes at a very high price, someone, if not us, has to pay for it and that someone is the Chinese and Indians (as well as the poor you refer to). The problem is if you raise their standard of living it will increase their cost base which means things will cost more so our standard of living will drop. Alternatively we'll need to be paid more which leaves those Chinese, Indians and poor where they were.
Life can be a bitch!
Which only goes to prove that the Capitalist system only works by the exploitation of the working class.
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How are they going to do that? Their standard of living may improve if they become more competitive, but there is only so much wealth to go around. For us to get cheap Chinese goods, it relies on the gap in wealth being maintained.
I assume you don't want them to remain in poverty, so are you willing to pay a 'fair' price for their goods, rather than supporting their oppression?
The only way we can all have an improved standard of living is if automation leaves us ALL with more free time to idle away. Efficiencies in manufacturing on both sides of wage gap will give us all a better standard of living in the long run.
BTW, before someone's says the fat cats get all the gains, that shouldn't happen unless the corporates are helped by corporatism. Of course the word globalisation has been dirtied,so what I refer to is global free trade.
The workers in the developing world need to organise to improve their pay and conditions.
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Its not the pay rates of UK workers that matter,its the 50%+ tax they pay + housing costs.Any UK manufacturing company has to pay a worker £30 to pay the income tax and NI on the £20 that goes to the local council in council tax.Rents around my area are around 450 a month,if HB was cut in half,so would rents.Its not the market that is shafting UK workers,its the government.Malinvestment over 40 years in the Welfare State.If any of them read the Beveridge report they would of seen that he said if it became like it is now it would destroy itself.The left has destroyed the welfare state,as the best form of welfare is not taxing people out of jobs.
Initially it was the rich that paid the taxes that funded the welfare state but over the last 30 years the burden has been shifted to ordinary working people.
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Rebalancing is inevitable when the wage divide is so high - we can't defy gravity. How do you propose we stop this?
Ask yourself a question: do you want to force China and India to live in eternal poverty while we live a gifted existence?
How about bringing their wages up to nearer ours instead of the other way round?
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The only solution is to be more competitive with the places the jobs are being off-shored to. You can only play the game of borrowing, to keep your old standard of living in place, for so long and then the money runs out.
We can froth and blame globalisation for all our problems, but it isn't going to go away, so we had better knuckle down and deal with it. The world is teeming with people who want the same standard of living as us and are prepared to work damn hard to get it. This won't change any time soon.
We've got to lower the cost of living and of doing business and try our best to use our technology and wisdom to keep us ahead of the curve. Taking out the parasites would be a good start in achieving this too. I simply don't see any other viable way around this.
So what this is really all about is forcing workers in the UK to work for wages that compete with workers in China and India.
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Of course it would be ideal to have the private sector create enough jobs for everyone in the UK.
But it doesnt. In fact with globalisation many existing jobs are being offshored.
During the boom the government could create jobs in the public sector for people but in the following bust and recession it cant.
So we are looking at massive unemployment with low welfare payments and those in work will see wages cut or eroded away.
The economy will go back into recession.
Where the ConLib government are being dishonest is in saying private sector jobs will be created to fill the gap.
They wont and whats more they know they wont.
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The reason why the last government created so many jobs in the public sector is because the private sector is hemorrhaging jobs overseas.
Budget Will Cost 1.3M Jobs
in House prices and the economy
Posted
I am not arguing that we have to continue on as we have been doing.
I am just pointing out that we would have had 1.3m more people on welfare than we did and that the private sector is not going to create 2.5m
jobs. In fact I would expect offshoring of jobs to be increased.