How high will unemployment get? In his interview with me in today’s Spectator (an extended, web version here) Alan Johnson says – towards the end – that we’d best prepare for two years of downturn. He was being optimistic. During the last three recessions (mid-70s, early 80s, early 90s) it took three years for the unemployment to peak – and there is every chance that it will keep rising in Britain until 2011. The below graph, from Citi, certainly chimes with the Balls analysis of this being the worst recession for a century. It looks like we’ll get ILO unemployment from today’s 1.9m to about 3.4m – which will make about 6.5m on benefits in total. Imagine the bill this will present to Cameron: between a fifth and a quarter of the entire British workforce on the dole. And this is why urgent welfare reform is needed. We simply won’t be able to afford the status quo:
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