“It’s positive news that the economy continues to grow, that jobs are being created – half a million jobs in the private sector in the last year…”
Chancellor George Osborne, speaking to C4 News’ Faisal Islam, 26 July 2011
A few alarm bells went off in the Channel 4 newsroom yesterday when the Chancellor flagged up jobs growth as the silver lining to some rather gloomy GDP figures.
In November, George Osborne told the Commons that private sector job creation would “far outweigh” the job losses in the public sector.
The public sector is expected to lose 370,000 jobs over the next five years, but the government hopes this will be offset by a growth in the private sector of 1.3m.
Half a million jobs in the last year sounds like a good start. But is Mr Osborne telling us the whole story, or is he – as charged by Ed Balls – a Chancellor who is in “total denial”?
Over the last year, private sector jobs are up 520,000 against public sector losses of 143,000, according to headline figures from the Office for National Statistics (ONS).
So broadly, it would seem that the growth in the private sector is on course to more than offset the slide in the public sector.
But look a little closer, and the data shows that 324,000 of these jobs – 62 per cent – were created in the six months between March and September 2010.
In the six months to March 2011, the UK’s private sector added just 196,000 jobs – accounting for 38 per cent of Mr Osborne’s feted half a million.
What’s more, in the year to the end of May the number of people in part time jobs rose by 16.8 per cent, or 181,000.
And the vast majority of this rise – 120,000 people or 66 per cent – came on stream from September 2010. They listed their reason for taking part time work as: “could not find full-time job”.
It strikes FactCheck as rather odd that Mr Osborne would boast about job creation in the private sector.
Since September growth in the private sector jobs market has slowed significantly.
It was running at 1.4 per cent between March and September 2010 – before the Chancellor’s spending review. But in the following six months, from September 2010 to March 2011, growth slowed to 0.8 per cent.
And all the while, part-time work has jumped up 17 per cent in the last year – 7 per cent in the last quarter alone – specifically because people couldn’t find full time jobs.
Mr Osborne gets a Fact for the headline figure, but if we were Chancellor, we wouldn’t be making a song and dance about jobs just yet.
By Emma Thelwell