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The First Tremors? |
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From the moment that politicians first discussed the possibility of making significant cuts to public spending some experts were predicting that it would lead to a significant slowdown in the economy and, as a result, a massive rise in unemployment.
Up until midway through January these warnings looked to be largely unfounded as the economy continued to rise from the recession, and even posted surprisingly good figures.
The most recent numbers, however, make grim reading for the government. The UK economy actually contracted in the last three months, shrinking by 0.5%, and completely ignoring all the predictions that had been flying around of continued, if slow, growth.
Of course, one of the major factors in this contraction was said to be the bad weather, which caused a lot of difficulties for the construction sector, accordingly, we can expect a stronger period in the next three months as that sector catches up on lost orders, but in general, the news was not good. Additionally, figures were released that demonstrated public borrowing had dropped by £5bn in the last three months, and the government will be hoping that these two figures together are correlative rather than causative.
So, could we be looking at the start of a slump brought on by cutbacks in public spending? Original estimates suggested that as many as 500,000 jobs would be lost in the public sector, although this has since been revised down, with as many as another 500,000 lots in the private sector as a result.
These figures are almost certainly inflated, and the private sector seems to be progressing well aside from the most recent data. The capital continues to perform strongly, with many jobs in London being created, but London was never going to be the problem for the recovery as it doesn’t rely as heavily on the public sector as certain other parts of the economy.
So far, unemployment has been hovering at consistent levels, but the next round of figures will be watched more keenly. However, for those who are already looking for a job, this latest news does not look good as it suggests there will be even more competition in the already overly-competitive job market. The best advice is to keep looking widely, and to keep an eye on websites like reed.co.uk and their rotation of jobs in London; that way you can hope that you can stay ahead of the competition. |
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