Thursday, January 27, 2011

Unemployment Too Low

During the the socialist paradise of the 70s, governments aimed at a full employment Economy. We had galloping inflation (20%..), dead bodies uncollected in the street, the IMF in, and the three day week. We were became the lauging stock of the world

This was, in part, because a full employment policy( objective claimed by no-one now ) is inevitably inflationary inefficient and unproductive. By the end of the 70s , even as we slid into third world status, unemployment was only at 1,100,000.( W of Discontent ).

The correction was a focus on inflation while a three fold increase in unemloyment to about 3,000,000 in 82 was tolerated .This was 12.5% of the working population. During this period( up to now ) patterns of work changed enormously ,the numbers in the working population increased as women flooded into the work place and the two income family became the norm. You have to bear this in kind and discount for the higher numerical figures

to give you some idea in the very height of the over blown boom numerical unemployment was hovering around 1,000,000 where it remained during what we now know to be artificially clement conditions , about 6%.

Currently it is between 7.5% and 8%

So if you look at the comparison

70s to 80s recession moved the pattern from 3%( usually taken to be full employment ) to a high of 12.5%.

Thus far a norm of 6% ish has moved to 7.75% at the end of 2010

. Of course there are special features now , youth unemployment is taking the brunt of the increase and some regions are suiffering by by comparison with other recessions ( not with either booms or normal times) unemployment is very mild indeed.

(ONS plus well known historical data )

With no sign of any supply side restructuring my suspicion is that the coalitions aim , to make Thatcher`s omlette with breaking eggs, is a dangerous dream.

( A comment I made elsewhere )


asquith said...

How can an unemployed person, especially one without children, have even a half-decent life?

I was on the dole for 4 months, starting this time three years ago, because that was how long it took to find work. It was so hard to make ends meet that I realised why people do really hardcore shite jobs in warehouses etc. Because the alternative is even worse.

Then you get areas like this city where something like 20% of people are unemployed. It ends in shite.

Newmania said...

I have sometimes wondered about that Asquith and I think for a working family it is indeed a life shattering disaster.
Most of them are a just habitual wasters though. No biggy

asquith said...

I don't think that's right, or why is there so much more unemployment than there was a few years ago?

I know there are lowlife. But there's no viable way of targeting them without making decent people suffer. They are in the same queue.

Auntie Flo' said...

From Boris's blog: Boris urges Chancellor, “Explain how you will cut taxes ?”

"You see, it was like this, officer…

I’m not ashamed to admit it, I’m one of the squeezed middle. My family owned SME has bounced along on the bottom for two years and we’ve kept our heads above water – just – against an onslaught of increased costs and a mountain of regulatory red tape, by working harder for less. Directors’ pay has been cut, while our staff’s pay has been frozen. Yet at least we’ve so far survived New Labour’s Regime of Terror, we told ourselves.

So we jumped for joy at the heady scenes in the rose garden last May, for ahead at last lay the Wicket Gate to restored civil liberties, enterprise without impediments and recrimination, decency in politics and a new vision of localism, Big Society and respect for the much abused, hard working people of our poor beleaguered country.

Yet all of us now, staff and directors, are begining to feel just like Christian, dragging a terrible and unjust moral and economic burden uphill from the City of Destruction, all of us desperate to find the Wicket Gate and Celestial City promised us by Boz, the Evangelist: and Cam in his younger, evangelising days.

“Follow the shining light…!”, called Boz, inspiring us to as stride purposefully towards paradise. “Er…what light’s that, I can’t quite see it”, said Cam, his brows deeply furrowed by the awesome challenge of austerity.

“NO! Don’t follow the light, it’s a capitalist illusion, you need us, Big Leaders, to drag you along the yellow brick, Planned Regional road to regulation, local taxes, fines and punishments for failing to keep to the rules!”, shouted Tory councillors Pliable and Worldly Unwiseman.

“And don’t forget to pay your parking fines, Wheelie bin and Social Justice taxes, 8 hour commercial parking permits, municipal insurance, smoking fines, vastly increased (council) office rent and utilities bills, your ‘Elf and Safety tax, Green tax, Climate Change tax, Social Justice and Existence taxes, you evil capitalists”, called Unwiseman, as we wearily trudged along.

Auntie Flo' said...

“But..but…the blue Manifesto Book in My Hand promised us Localism, small government, civil liberties, a bonfire of regulation and quangos and a spirit of enterprise. We believe in small government, big society and big enterprise.” I objected.

“Oh, no,no,no,no,no,no you don’t”, said Unwiseman, you just concentrate on paying our Big Pensions…er fines, taxes and penalties…and leave all of the enterprise and technical stuff to Pliable and me, we’re rolling out the Big Society to approved stakeholders in line with EEDA’s Regional Plan”, they added, their voices now dark and menacing.

That was when I pushed Unwiseman and Pliable into the Slough of Despond, officer, and noticed that the Wicket Gate was right next to it, though Evangelist Cam barred my way.

“You can’t go into the Celestial City”, he said, until you’ve paid your 20% VAT, increased fuel tax and met your corporate responsibilities. By the way, while you’ve been looking for the Wicket Gate, your council decided they want to build 16,000 more modern, stretched, high density houses and flats in your town, in line with Labour’s Regional Plan, most of them in your ward and exiting (sorry about the heritage and conservation areas) onto your road by the look of it: but don’t worry about the already gridlocked traffic, they say traffic will get no worse as the council are putting a bus lane on the roundabout.”

That was when I told Cam to jump in the slough, officer and shouted, “Right, that does it, I might just as well vote Labour for the first time in my life in May. Why? Because it feels as though Labour never lost control of my town and, if others do it too as I suspect they might, to teach the Conservatives a really Big Lesson.

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