There are storm clouds on the horizon for the economy in the North. While the recession took longer to bite than in the south this only reflects the weakness of capitalism and the predominance of public sector employment. There are now as many people who are economically inactive (26%) than work in “private industry”. But the crisis has now caught up with a vengeance and it is only going to get worse.
The North is in the firing line from the British Tory/ Liberal Democrat coalition who have said that planned spending cuts will fall most severely on those areas where there is a high density of public sector employment. This means the North of Ireland and the North East of England in particular. But the effect in the North where 70% of jobs are in the public sector is likely to be catastrophic.
As the Sunday Business Post reported on 22/8/10:
The North’s economy is in danger of going into freefall and could be facing “a ten-year period of deflation and joblessness”, according to one of the region’s leading trade union representatives.
Peter Bunting, assistant secretary general of the Irish Congress of Trade Unions (Ictu), said that as many as 30,000 public sector jobs could be lost in the coming months, with even more lay-offs in the private sector.
“We’re on the verge of the abyss,” he told The Sunday Business Post. “Unemployment in Northern Ireland is becoming a massive crisis.”
Unemployment has now risen by 33,000 over the last 3 years. The actual rate of unemployment is 6.6% which is lower than the Republic and Britain, but the big issue is that the cuts haven’t really begun to bite. The Tory budget telegraphed some figures for potential cuts, but the effects won’t become clear until after a Comprehensive Spending Review in October and they will be dramatic.
The Sunday Business Post continues:
“In most of the UK regions, numbers on the dole have started to drop off, but in Northern Ireland the opposite seems to be happening,” said Ulster Bank chief economist Richard Ramsey.
“There hasn’t been an improvement in the underlying fundamentals in the economy since the credit crunch and that’s why we are not seeing any improvement on the jobs front.” Ramsey highlighted the fall-off in the construction industry as a significant factor in the North’s rising unemployment rates.
“There hasn’t really been any recovery at all here. In terms of the double-dip recession we haven’t even come up for air yet to go back under.
“The public expenditure cuts are only starting to filter through.
“So, of all the UK regions, we are in the most vulnerable position,” said Ramsey. He anticipates a further 70,000 job losses in the North over the next 18months.
This would be an utter disaster for the North and the effect will be most dramatic in the working class areas, in both communities. One thing is for sure none of the parties sitting in Stormont have any solution to the jobs crisis, this is a class issue.
These cuts will affect all workers regardless of religion. They will devastate services and the communities that depend upon them. They will affect the young, the old, the sick and the vulnerable. The cuts will have a knock on effect on the private sector also, particularly the building trades, as school building programmes are slashed. The Tories have launched an economic civil war on the North. What’s needed is a united response from the whole of the working class. The situation demands an urgent response from the public sector trade unions and a united working class political response to the Tories’ class war politics.
Source: Fightback (Ireland)