Dreaming of job creation

Much as I applaud the sentiment behind David Cameron’s plan to help employment by cutting taxes, did he have to claim he’d “create 350,000 jobs” that way? He may answer: yes, the media want such a figure, and just you see they’ll put it high up the story tomorrow. Plus we’re not in power, so we’ll never have to prove it. But to my nerdy eye, this figure spoils it. I mean, there are 940,000 on Jobseekers’ Allowance – is Cameron really proposing to reduce that that by a third? In a downturn?

But my more serious objection is that cutting payroll tax at the margin has a heavy deadweight cost: would these employers take on staff anyway?  The document the Tories produced to back up their proposal today is packed full of excellent research, figures and references.