Chancellor George Osborne’s austerity drive will make the return to pre-recession levels of employment “slower and more painful” than many people expect, shadow work and pensions secretary Douglas Alexander will warn in a speech.
With the UK’s dole queue shrinking by just 15,000 since the coalition Government came to power, it could take 15 years before numbers claiming out-of-work benefits drop below one million if present trends continue, he will say on Tuesday.
And he will accuse the coalition Government of complacency over the prospects of a swift increase in private sector employment to compensate for hundreds of thousands of job losses expected in the public services.
Job vacancies have fallen every month since June and stand below the levels of the start of this year, when Britain was only just emerging from recession, Mr Alexander will say.
Speaking to the Demos think-tank, Mr Alexander is expected to warn of the danger of a “jobless recovery” and to say that it will take time for workers laid off from public sector jobs to adjust to private sector work, which might require new skills or a move to a different part of the country.
And he will say that the Government’s reliance on a shift from public to private sector jobs risks creating “socially damaging” long-term unemployment in areas where the state has traditionally been a major employer.
Mr Alexander will say: “In the sometimes overblown media claims about double-dips and rapid recovery, I think there is a risk that the real and present danger in the jobs market goes almost unnoticed. I’m worried that the Government is too complacent about the risk of a slower and more painful return than many yet realise to the levels of employment and unemployment we have become used to.
“The wider jobs gap is an issue that the Government doesn’t seem to have recognised.
“We are seeing in the US, and in many other industrialised countries, a painfully slow return to pre-crisis levels of employment.
“For the UK, my fear is that George Osborne’s agenda, even with some amelioration from (Work and Pensions Secretary) Iain Duncan Smith, will make that return slower and more painful than is yet widely understood. As in their whole approach to welfare reform, without work it won’t work.”