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Not enough private sector jobs for upcoming public sector cuts

There will likely not be enough jobs in the private sector for all those caught in the next wave of public sector cuts, according to new research.

A report from the Institute for Fiscal Studies (IFS) found that the public workforce is set to fall by up to 800,000 by 2018-19, compared to a drop of 375,000 from 2010 to 2014.

Due to this the private sector will need to create new jobs to stop the former public workers being unemployed. The report said: “It remains to be seen whether such large reductions can again be accommodated through moves into private sector employment rather than into non-employment.”

The research shows that the number of public sector employees fell sharply at the start of the coalition government but slowed after 2011. From that time workers leaving the public sector were almost fully absorbed by the private sector.

About 5% of public sector workers in 2013 moved to the private sector, the highest level since the early 1990s.

Cuts to the public workforce were found to have been smallest in protected areas such as the NHS and education. The largest reductions were in public administration, which includes administrative staff across the sector, including the Civil Service, local government and Job Centre Plus.

Luke Sibieta, a programme director at the IFS and an author of the report, said: “Given the historically large cuts to the public sector workforce over the last parliament, it is encouraging to see increases in the numbers of public workers managing to find new jobs in the private sector.

“With the pace of workforce cuts set to accelerate in the coming years, the capacity of the private sector to absorb former public sector workers will need to increase further to prevent them spending a significant amount of time out of work.”

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