More than one in seven public sector jobs will be lost as a result of coalition government budget cuts, leading to "a tectonic shift" in the nature of the UK labour market, according to the CIPD.
The organisation cited the Office for Budget Responsibility‘s latest employment projections, which indicate that the public sector workforce is on course to fall to a record low in terms of numbers.
The OBR estimates that the number of people employed by central and local government will fall by around 700,000 during the course of the current Parliament (2010-2015) – and by a further 880,000 by the time that the Chancellor hopes to have cut the structural fiscal deficit in 2017.
John Philpott, the CIPD’s chief economic adviser, said: “This will easily wipe out the net rise in public sector employment under the Labour government between 1999 and 2009 and take the public sector workforce to a record low."
More than one in seven public sector jobs are expected to be lost as a result of the squeeze on public spending, with the public sector eventually accounting for only one in six UK jobs, down from a peak of one in five prior to the recession, he added.
Although the OBR still anticipated that private sector job creation would compensate for the cull, "public sector downsizing on such a scale nonetheless represents a tectonic shift in the underlying structure of the labour market, with broader implications for what people can expect to experience in terms of pay, conditions of work, management practice and workplace cultures", Philpott said.
A second study, conducted by agency, Interim Partners, meanwhile, also pointed to the tough time that the public sector is having in employment terms.
It revealed that the proportion of interim managers working in the space had hit a pre-credit crunch low, with a mere 34% of interim assignments being undertaken in the public sector in the fourth quarter of last year – the lowest percentage since the fourth quarter of 2007, when the figure was only 30%.
Daily rates for interims working in the public sector have also plummeted by an average of 10.3% over the last 12 months from £728 to £653 per day. This situation contrasts with that for colleagues in the private sector, who saw rates rise by an average of 6.5% from £741 to £789 per day.
Doug Baird, Interim Partner’s managing director, said: "Interim managers performing turnaround or restructuring roles remain in very strong demand. Those interims managers who can point to significant experience within the relevant sector such as retail banking or insurance current attract a premium over generalist interims with experience in a number of different sectors."
