Peter Hoskin

The widening public-private divide

The widening public-private divide
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The growth of the public sector isn't exactly new news, but the figures attached to it are always pretty eyecatching.  These courtesy of Allister Heath in City AM:

"MORE evidence of a growing public-private divide: 57 per cent of extra UK jobs created during 1997-2007 were either officially on the government's payrolls or 'para-state', technically private but dependent on government funding. And that was before the private sector jobs bloodbath since 2008.

Manchester University's Centre for Research on Socio-Cultural Change calculates that of the 2.24m net new jobs created in 1997-2007, 1.27m were state or para-state (the latter includes the likes of rubbish collecting, government funded private nursery education and private healthcare and various consultants) including an astonishing 81 per cent of the 1.1m extra jobs taken by women.  In the North East, 79 per cent of new jobs were state-dependent, compared with 41 per cent in London and the South East, both still bastions of private enterprise. There was a net drop of 37,000 private jobs and a 105,000 rise in state and para-state jobs in the West Midlands."

As Allister goes on to say, the sheer size of the public sector payroll threatens to be one of the biggest impediments to getting the deficit down.  In which case, it's mildly encouraging that policymakers seem to be moving in the right direction on this.