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Public sector job losses to hit 750,000

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The number of public sector jobs to be axed as a result of the spending cuts will be around 750,000 - a quarter of a million more than government estimates, a respected economist has warned.

John Philpott, chief economic adviser at the Chartered Institute of Personnel and Development (CIPD), said the prediction of 490,000 by chancellor George Osborne understated the full impact of public sector downsizing.

Dr Philpott said the spending review had “conveniently” failed to mention that the Office for Budget Responsibility (OBR) had forecast a loss of 660,000 public sector jobs between now and 2015/16.

He said: “Unless the Chancellor decides to reverse spending cuts pencilled in for 2015/16 he should admit this will be the outcome, at least until the OBR publishes its next forecast on November 29.

“Moreover, the spending review does not acknowledge the likelihood that very large percentage cuts in the cost of administration across Whitehall, local authorities and even ostensibly ring-fenced areas of spending such as the NHS, will have a disproportionately negative impact on some of the most labour intensive parts of the public sector.

“As a result, the CIPD estimates that the public sector jobs impact of the spending review to 2014/15 will be above 500,000, with total job losses rising close to three-quarters of a million by 2015/16 if the coalition sticks to its existing longer term spending plans.”

He added that in the face of huge job cuts, it made “little sense” to expect pay restraint or changes to working hours in the public sector because workers would be getting nothing in return.

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