Employment: New Jobs

Lord Freud Excerpts

Monday 27th January 2014 Lords Chamber

[The Earl of Courtown]

To ask Her Majesty’s Government how many new jobs have been created in the private sector for each job lost in the public sector since 2010.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud)]

My Lords, figures released last week show that since 2010 the number of people in work has increased by 1.3 million, bringing total employment to a new record high of 30.15 million. The latest private and public sector employment figures, which were released last month, show that since 2010 the rise in private sector employment is more than three times the fall in public sector employment: the number of public sector jobs has fallen by 451,000, while nearly 1.7 million jobs were created in the private sector.

[The Earl of Courtown (Con)]

My Lords, I thank my noble friend for that good news. Is he aware how noble Lords on all sides of the House consider the importance of youth unemployment? Will my noble friend explain to the House what further actions Her Majesty’s Government are taking to reduce those figures further?

[Lord Freud]

Youth unemployment is clearly a critical part of our strategy. I am pleased to be able to say that the number of youth claimants for JSA went down this year—by 105,000—to 315,000, which is an enormous percentage change but it has been going down now for 19 consecutive months. Long-term youth unemployment has also been going down at a very sharp rate, and the number of young NEETs is the lowest for a decade. We have been pumping up the number of apprenticeships, with 1.5 million places created; work experience is vital—there are 113,000 places. The sector-based work academies are all pushing youngsters into the employment market. As noble Lords know, the key measure I always use is that we manage to make a turnaround in the number of youngsters out of work and out of education, which rose through the boom years of the previous Government. We have now turned that round.

[Lord Lea of Crondall (Lab)]

Will the Minister repeat the figures he gave in terms of full-time equivalents?

[Lord Freud]

The figures I have are the actual figures: the number of youth claimants is down, by 105,000 in the year, to 315,000.

[Baroness Neville-Rolfe (Con)]

My Lords, the figures on unemployment, especially what the Minister has said about young people, are very good. Will my noble friend comment on the regional spread of the new jobs and on which industries and sectors are benefiting from this good news?

[Lord Freud]

I am pleased to say that the regional position is pretty balanced. During this quarter, employment rose in virtually every UK region, with one exception. The north of England and the Midlands are doing particularly well. If one looks at the balance between the north and the south, since the election there have been 360,000 extra private sector jobs in the north—to take those four regions together—and 420,000 in London and the south-east.

[Baroness Sherlock (Lab)]

If that information is right, can the Minister explain the report from the Centre for Cities, which shows that four out of five private sector jobs are now created in London? For example, private sector employment grew by 2.8% in London year on year, but it fell in Sunderland and in Bradford it fell by more than 5%. Do the Government have a strategy for jobs north of, say, Witney?

[Lord Freud]

I hope that I made it very clear to noble Lords that this is a very widely spread recovery, that the north is doing very well and that the noble Baroness is misrepresenting the actual figures.

[Lord Purvis of Tweed (LD)]

My Lords, with regard to some of the information that has already been cited, is it not exciting news that the Edinburgh economy is doing particularly well and employment levels in Scotland are also successful? Would my noble friend agree that this shows that, for Scotland, Liberal Democrat economic policies, of course made in partnership with friends on the Conservative Benches, are successful and are making a positive impact on the lives of people who are now in jobs?

[Lord Freud]

My Lords, we have a widely spread recovery, which is touching all the regions, as I said. To pick up a point that I may not have dealt with adequately, these are full-time jobs. More full-time jobs have been created over the past year than total jobs; in other words, we are reducing very slightly the number of part-time jobs, if that is the full-time equivalent. This is a widely spread recovery of jobs—long-term jobs, female jobs, regional jobs, young jobs. This is good news.

[The Countess of Mar (CB)]

My Lords, would the Minister care to comment on the report in today’s press that British apprenticeships are being advertised in Romania?

[Lord Freud]

My Lords, I cannot control where people advertise anything.

[Lord Hughes of Woodside (Lab)]

While it is understandable that the Minister takes great pleasure from the increase in private sector employment, does he not accept that there is something Orwellian about his response—namely, private sector jobs good, public sector jobs bad? Has he no conception of the damage done to people’s lives by the vast decrease in public sector work?

[Lord Freud]

My Lords, the point that I have been making is that those jobs lost in the public sector have been more than replaced—by a factor of three—in the private sector right the way round the country. That includes the regions as much as the south. Let me make a point about efficiency in the public service. The size of the workforce has decreased by 15% since 2010, so the Civil Service is now the smallest since the Second World War, but output has not decreased. Productivity in DWP, for example, has been steadily improving, and improved by 12% in 2011-12.

[Lord Eatwell (Lab)]

The Minister has referred continuously to “good news”. He has just referred to issues of efficiency in the public sector. Will he refer to the collapse in productivity in the private sector, which is the counterpart of the high level of employment, as also good news?

[Lord Freud]

Well, my Lords, I have very good news for the noble Lord. We are currently restructuring the benefits system to help with that productivity issue. One of the things that universal credit does is to make sure that we have as flexible a labour force as possible. That is something that employers around the country welcome.

[Lord Roberts of Llandudno (LD)]

As we welcome those throughout the European Community who come to work in the hospitality industries—I come from a seaside resort—what is the Minister doing to encourage UK youngsters to take up jobs in the hospitality industry?

[Lord Freud]

My Lords, one of the most enthusiastic sectors to adopt the sector-based work academies was the hospitality industry. The industry has a programme to make sure that people have training, work experience and then a chance of a job, and that has been going very well in that particular sector.

[Baroness Armstrong of Hill Top (Lab)]

My Lords, will the Minister reconsider his views about all of the regions? I come from the north-east and I go back to the north-east every week. I have invited him to the north-east to see what is actually happening. The north-east has lost a significant number of public sector jobs. Yes, it has seen the creation of part-time and full-time private sector jobs, but it still has double-figure unemployment rates.

[Lord Freud]

Clearly, my Lords, there has been the most enormous recession, and that was built under the previous Government. To remind noble Lords, the latest ONS figures for the 2008 recession show that GDP fell from top to bottom by 7.2%. That compares with the 1930s, for which the NIESR show a fall of only 6.9%—it was worse than the 1930s, a terrible smash. We are pulling it back and the figures in the north and round the rest of the country are showing an improvement. In all of those regions the private sector improvement well outweighs the necessary reduction in public sector jobs.