On the private sector and urban renewal...

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This quote from Mick Cornett, Mayor of Oklahoma City rather struck me:

But if you can create a city where people want to live and if you can create a strong economy, then you can develop a private sector that can afford a lot of the social spending that a large community needs. If you can be a partner in building a strong private sector, you’re going to be able to take care of a lot of the social needs that most people equate with tax-and-spend government.

How to make it work is another matter but this is a welcome break from the public sector dominated traditions of our failing urban regenerations.

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Get the right skill and you should have no problem getting a job...

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...or so it seems:

Job opportunities were 17% higher in December 2011 compared with the same period in 2010, and were more than one-fifth higher than in December 2009, according to figures published today by reed.co.uk. The most recent Reed Job Index data highlights growth in demand for new staff in 2011 compared with 2010. According to Reed, this trend was largely driven by demand for technical staff, such as engineers and IT and telecommunications specialists, with an annual increase in job vacancies of more than 40% across these roles.

But a couple of sectors continues to decline:

Unsurprisingly, decline was reflected in the figures for public sector activity, with demand in that sector 15% lower than during the same period in 2010, and at one-third of its 2009 level.

Meanwhile, demand for staff in financial services fell slightly in December 2011 to a little below its level of 12 months earlier, although it is still above its level two years ago when the index began.

Not surprisingly the UK can find jobs for skilled people who contribute to production and create wealth but not for parasites like me!

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...about that public sector pay

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Seems like the private sector is still taking most of the pain:

Take home pay in the public sector has increased, showing annual growth of 1.7% for the three months to August, according to this month's VocaLink FTSE 350 Take Home Pay Index.

This contrasts with the private sector, where pay growth has declined for the second consecutive month, hitting 2.7% in August, down from 2.9% for the three months to July

Why am I not surprised.

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Tell me again about those strikes?

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The latest figures confirm the public-private sector pay gap:

Information released by the Office for National Statistics (ONS) yesterday revealed that public sector workers are paid on average 7.8% more than their private sector counterparts. This figure has risen by 2.5% since 2007, when the pay gap was estimated to be around 5.3%.

And an index-linked, final salary pension to boot!

Forgive me if I don't weep beef tea at the plight of public sector workers.

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Why are we surprised that private sector workers don't back Labour?

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In one respect this is just another opinion poll:

"Members of the far-left Unite union behind the British Airways strike want their bosses to stop giving money to the Labour Party. In a stunning affront to the hard-liners running the union, a poll has revealed that grass-roots members would also prefer David Cameron to Gordon Brown as Prime Minister. "

In another respect it is a reminder to the Conservative Party about where they should be targeting campaigning efforts. The current strategy appears - with historical justification - to have been directed towards AB voters. However, this poll confirms that the new bedrock of support for the Conservatives will be the ordinary workers employed in the private sector and the self-employed.

And - as I said here - there's other polling evidence to support this assertion. Evidence that this Unite poll confirms. And this is what I said about those voters:

"These are the people who were most damaging by the smoking ban, who are irritated by the endless nannying lectures on drinking, eating and, seemingly, everything else they enjoy. These are the people who are roundly cynical about global warming, who want to use cheap flights to warm places once or twice a year. These are the people who’ve seen labour rob their pensions, let them down on education and want to tax them to the hilt for the horrible crime of using their cars.

And let me close by saying this: if Anthony Wells analysis is right then David Cameron has his strategy wrong. Sucking up to middle-class Lib Dem voting public sector professionals and labour-voting social workers by coming across all green simply isn’t delivering – in fact, if we carry on like this, we’ll just alienate those hard-working people who hate labour more than they love the Tories"

Two questions for public sector managers...

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Staff survey at work – options of no pay rise, no increments, reducing hours and redundancies (unspecified). I have responded appropriately but it got me thinking about the doom and gloom coverage around public sector workers.

So two questions for public sector managers:

1. If you believe what you do to be important, would you be willing to do what thousands have done in the private sector – accept a 10% pay cut?

2. If there’s a choice between sacking some people or you all not taking pay rises or annual salary increments but you’re not threatened, would you still take the cash knowing someone else will lose their job?

Just asking....

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Is too much public sector employment strangling Northern cities?

For a long while I’ve felt a little like a lone voice in the wilderness regarding the damage that an over reliance on public sector employment is doing to many of our towns and cities – especially in the North of England. Moving public sector jobs “up north” has been popular with policy-makers wanting to try and fix the decline in traditional manufacturing jobs (so long as it doesn’t include said policy-maker having to relocate from the soft south, of course).

However, the Centre for Cities has now issued a strong challenge to this orthodoxy – arguing in a recent paper, Public Sector Cities: Trouble Ahead that cities are:

“…investing an undue amount of time and resource into competing for a small number of relocating public sector jobs. Promoting private sector growth would be a more sustainable option.”

The paper also reveals just how dependent the economy of some towns is on continuing public sector largess. Eleven towns & cities have more that a third of their work force in the public sector including Liverpool, Oxford and Barnsley. And as the inevitable public spending cuts arrive it will be workers in these places that go ahead of the more proximate Whitehall bureaucrats.

But it’s not just the jobs it’s the squeezing out of enterprise by the dominance of public institutions – nationally there are 415 VAT-registered businesses for every 10,000 people. In Liverpool this figure is just 241, in Barnsley 274 and in Plymouth a measly 233. Since I don’t believe folk in these places are much different from more enterprising places, there has to be cultural and environmental factors leading to this deficit – and the leaden hand of dominant public institutions provides just those factors. Not being enterprising because Dad expects you to go down the pit has been replaced with not creating because there’s an admin job at the DWP.

In truth too much of the North’s economy is made up from public expenditure – by what amounts to a subsidy from the rich South to the poor North. And the result is that the North does not add value – does not earn its share of the nation’s wealth. In 2005/6 public spending and GVA per capita by region related inversely to levels of public spending:

Public Spending % of economy

North East: 61.5; North West: 52.6; Yorkshire:48.9; South East: 33.9; London: 33.4

GVA per capita

North East: 13.5; North West 15.0; Yorkshire 14.9; South East 19.5; London 22.2

In the end places get richer (however you wish to define that idea) because of the enterprise, initiative and creativity of the people who choose to live in that place. Importing soul-less, stifling public sector employers is killing that drive.