Press Release

Public sector workforce shrinking fast: further reductions could be up to 30-40% outside of education and NHS

Date: 14 February 2014
Authors:

The Office for Budget Responsibility (OBR) forecasts that general government employment will fall by 1.1 million (19%) by 2018–19 compared with 2010–11. If delivered, these cuts would be the largest recorded over the past fifty years: almost three times larger than the reductions in the early 1990s. A buoyant private sector labour market, though, means that up to now private sector employment has risen by more in every region than public employment has fallen.

With schools and NHS budgets currently protected from cuts the long run shift in the composition of the public workforce will continue. Already 57% of public sector workers are employed in these two sectors, up from 42% in 1991. This proportion could reach over 70% by 2018 if education and health were protected from future workforce cuts.

These are amongst the main findings of a new research, published today by the Institute for Fiscal Studies (IFS) and funded by the Joseph Rowntree Foundation, with support from the ESRC through the Centre for the Microeconomic Analysis of Public Policy at IFS. This study provides, for the first time, a consistent picture of how the size and composition of the public sector workforce has changed over the past fifty years.