Magazine article The Spectator

A Miracle at Work

Magazine article The Spectator

A Miracle at Work

Article excerpt

The jobs boom is one of the Tories' finest achievements. Why aren't they talking about it?

Feeling the genitals of freshly hatched chickens may not be the most glamorous job in the world but at £40,000 a year it's not badly paid. It requires some stamina: you pick up hundreds of chicks a day and check their 'vent' for boy parts. If it's a baby hen, then she's sent off for a life of corn and egg-laying. If it's a baby rooster -- well, best not to ask. Almost nobody in Britain wants to do it, so vacancies go unfilled. The poultry industry, in desperation, has asked the government to add 'chicken sexer' to its growing list of seemingly unfillable jobs.

This fits a trend. In five short years, Britain has gone from having mass unemployment to jobs galore. Unemployment is falling at a rate that confounds the economists, and employers are starting to panic. Maths teachers, chefs -- the list of 'shortage occupations' grows ever longer. Construction companies are not tendering for work in London because they can't find bricklayers. Financially this is a headache, but economically it's a problem of success. The Prime Minister set out to get rid of the deficit. He failed. But instead he has presided over a jobs miracle -- one that economists and policymakers are still struggling to understand.

Just before the Budget was published, the latest figures came out -- all of them smashing records. There are 30.9 million of us in work, the most ever. That's an employment ratio of 73.3 per cent, the highest in history. Employment is up by 1.7 million since Cameron took power and 1.5 million of these jobs are full-time. The number on Jobseekers Allowance fell by 30 per cent last year alone and the youth claimant count stands at its lowest since the 1970s. Birmingham added more jobs to its economy last year than the whole of France; Britain is adding more than the rest of Europe. David Cameron can take credit for creating more jobs than any first-term prime minister in postwar history.

Against this backdrop, this week's Budget wheezes pale into insignificance. Yet still the government prefers to focus on the smoke and mirrors than on its genuine and staggering success with jobs. Last month, Iain Duncan Smith briefed the House of Lords on all the progress and was given a standing ovation. And a few awkward questions. 'This was all new to us and we're Tory peers,' said one present. 'We wanted to know: why isn't the party talking about this?' Ministers are being asked to behave like pull-string dolls, repeating the nebulous phrase 'long-term economic plan' when asked a question about sport. It sounds like spin. The irony is that it conceals a genuine achievement of radical Conservatism.

At the start of this government, Ed Miliband predicted a jobs armageddon -- austerity would inevitably mean mass unemployment. Osborne would cut 500,000 public sector jobs, he said, with 'no credible plan to replace them'. And surely government spending is synonymous with prosperity? Boldly, he forecast a ratio: one private job would be lost for every public sector job lost -- leading to the loss of 'a million jobs in all'.

The conventional Keynesian wisdom, to which Miliband subscribed, is that government spending cuts make the economy weaker: fewer public sector workers means less money spent in the shops, so less demand, therefore more unemployment. Osborne saw things differently. What if the problem was not the supply of jobs, but the supply of willing workers? If you cut taxes on low-paid work, it becomes more attractive: more people want to move from welfare. Especially if welfare reform makes it harder to game the system.

Ed Miliband was right about the public sector job cuts. Almost half a million have gone -- but two million private sector jobs have been created. The ratio, of almost five jobs created for every public sector job shed, was something no one dared predict when Osborne started cutting tax and reforming welfare. …

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