Are we on the verge of significant job cuts in the public sector?
A report issued today would appear to confirm that the UK public sector, a sector which has mushroomed in size over the last few years, is set to be slashed over the coming 12 months with one in three public sector companies looking to reduce their workforce. Despite the fact that the UK government is arguing that investment in the public sector should be maintained and increased as the UK pulls away from recession, it would appear that under the surface the very opposite is happening.
It will be interesting to see where the majority of the expected job cuts come from and whether the UK government recognises the fact that investment in public services does need to be cut in the short to medium term. The Conservative party has stolen something of a march over Gordon Brown on this particular subject but a U-turn at this stage may cause less damage to the Labour Party's reputation than a change of heart nearer to the general election.
It is obvious to anybody who has studied the UK economy that public sector spending has in many ways supported the employment market over the last few years while increasing the burden on UK taxpayers. Whether we are seeing a long-term readjustment or a short-term response to the economic downturn very much remains to be seen.
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