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600,000 public sector jobs “to be axed by 2016”

1 July 2010

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The legacy of the government’s emergency Budget will result in more than half a million jobs being lost in the public sector by 2016, figures have suggested.

In addition to the public sector cull, the overall number of jobs in the UK in just over five years’ time will be lower than the number that would have been available under a Labour government, the Office for Budget Responsibility (OBR) said.

However, those unfortunate enough to lose their jobs as part of Chancellor George Osborne’s austerity Budget will find themselves in demand in the private sector, which will offset the losses by more than one million, the OBR said.

Some 600,000 public sector jobs are expected to be culled as a result of the Budget, according to the OBR.

But it is the overall impact on jobs across the UK that has provided the most startling results, after the OBR predicted overall employment to stand at 29.97 million by 2014/15 – 50,000 fewer than the 30.02 million it predicted before the Budget was unveiled on 22 June.

The OBR released the data ahead of schedule after the Guardian newspaper revealed the contents of a leaked Treasury document, which it said indicated that the government was expecting unemployment to rise by 1.3 million as the impact of the Budget took its toll.

A spokesman for the prime minister said the newspaper’s report was “obviously misleading”.

Copyright © Press Association 2010

Office for Budget Responsibility