British Deficit In Jobs Terms

[aa3]

Say each job is £50,000 a year. And the deficit is £200 billion a year lately. Well 200b/50k = 4 million.

4 million £50k a year jobs. The total British workforce is 28.4 million.. down from around 30 million a few years back.

Is it even remotely plausable that if the coalition cut the deficit in half by cutbacks, that the private sector would pick up 2 million in £50k a year jobs?

[robo1968]

Say each job is £50,000 a year. And the deficit is £200 billion a year lately. Well 200b/50k = 4 million.

4 million £50k a year jobs. The total British workforce is 28.4 million.. down from around 30 million a few years back.

Is it even remotely plausable that if the coalition cut the deficit in half by cutbacks, that the private sector would pick up 2 million in £50k a year jobs?

I am not sure why you used £50K for this when the average is around £25K

Wouldn't have thought so.though, reality is there needs to be more incentives for the private sector than public to try and tip the balance back to reduce the spending.

How would you manage it?

[porca misèria]

Say each job is £50,000 a year. And the deficit is £200 billion a year lately. Well 200b/50k = 4 million.

4 million £50k a year jobs. The total British workforce is 28.4 million.. down from around 30 million a few years back.

Is it even remotely plausable that if the coalition cut the deficit in half by cutbacks, that the private sector would pick up 2 million in £50k a year jobs?

If the deficit were NOT cut, one of two things happen. Either money is printed Weimar-style, so £50k becomes the price of, say, a pub meal. Or the rising tax bill cripples the productive economy and kills jobs.

We've had a spell of the second. Another five years of it could turn critical and cost not 2 million but 20 million jobs. In other words, strangle the real economy.

[lurker07]

Until people get it into their thick skulls that the cost of servicing high house payments is detrimental to the economy, I'm afraid that unemployment will rise and rise.

Then hopefully people might realize the REAL problem with the economy.

Artificially creating demand is a very dangerous game.

[aa3]

I am not sure why you used £50K for this when the average is around £25K

Wouldn't have thought so.though, reality is there needs to be more incentives for the private sector than public to try and tip the balance back to reduce the spending.

How would you manage it?

I think the system needs reform on several fronts. We have way, way too many regulations and restrictions on things. So say mass development of houses and condo buildings was allowed, it would create more jobs and over time bring down the cost of housing.

The other is the £200 billion of deficit stimulus didn't all need to go to funding government. It could go to middle and poor Britain in the form of tax cuts, or subsidizing things everyone buys. Instead of having a £700 billion budget, and 500b in tax revenues. We could have a 600 billion budget and 400b in tax revenues.

That is also the 100 billion in cuts to make the public sector a smaller piece of the pie, while still having the 200 billion deficit for stimulus in these times of demand shortage.

The key thing is the middle 80% say those from the 15th percentile to the 95th percentile.. they need to have some real disposable income, so they can go out and churn money through the economy. I

[aa3]

If the deficit were NOT cut, one of two things happen. Either money is printed Weimar-style, so £50k becomes the price of, say, a pub meal. Or the rising tax bill cripples the productive economy and kills jobs.

We've had a spell of the second. Another five years of it could turn critical and cost not 2 million but 20 million jobs. In other words, strangle the real economy.

At this point in time £200 billion in deficit is not likely to lead to out of control inflation. The British money supply is probably around £7.5 trillion in size.

The latter of rising tax bill is imo more dangerous. The less disposable income middle Britain has, the harder it is to actually make money in the economy. As less people are buying.

[Snugglybear]

According to Forbes, Denmark is the best country to do business.

Denmark is still the best country in the world to do business, according to a Forbes report, but the US has dropped from second to ninth place, while Hong Kong has gone the other way. The UK has fallen from sixth to tenth place, replaced by Ireland, in Forbes's fifth annual ranking of the Best Countries for Business.

http://www.guardian....ntries-business

The actual report is here http://www.forbes.co...iness_Rank.html

Yet measured as a percentage of GDP, Denmark has the highest taxation in the world - that's all forms of tax, not just income tax.

Unemployment in Denmark this year is running between 4.1% and 4.2% of the workforce.

Perhaps we should look at a country which seems to be doing things right, and set about doing the same.

[robo1968]

I think the system needs reform on several fronts. We have way, way too many regulations and restrictions on things. So say mass development of houses and condo buildings was allowed, it would create more jobs and over time bring down the cost of housing.

The other is the £200 billion of deficit stimulus didn't all need to go to funding government. It could go to middle and poor Britain in the form of tax cuts, or subsidizing things everyone buys. Instead of having a £700 billion budget, and 500b in tax revenues. We could have a 600 billion budget and 400b in tax revenues.

That is also the 100 billion in cuts to make the public sector a smaller piece of the pie, while still having the 200 billion deficit for stimulus in these times of demand shortage.

The key thing is the middle 80% say those from the 15th percentile to the 95th percentile.. they need to have some real disposable income, so they can go out and churn money through the economy. I

Thanks for that, I like the part about housing!

[bobthe~]

Not every pound in savings means a job though, does it?

Materials aren't always free...

Not buying replacement equipment, or at least putting that off for a few years will save money without necessarily impacting on jobs in the same way.

Edit to add:

Why not lose the all the 100k+ consultants from EDS and Accenture or whichever leech is attached these days?

Edited September 29, 2010 by bobthe~

[aa3]

Yet measured as a percentage of GDP, Denmark has the highest taxation in the world - that's all forms of tax, not just income tax.

Unemployment in Denmark this year is running between 4.1% and 4.2% of the workforce.

Perhaps we should look at a country which seems to be doing things right, and set about doing the same.

Imo sharing the wealth and co-operating makes for a better, bigger economy. A few rich guys hoarding their money, and millions just subsisting makes for a small, weak economy.