John Philpott (pictured), the organisation's chief economic adviser believes this would help explain an apparent disconnect between OBR estimates and various independent estimates of the scale and phasing of reductions in public employment, aid assessment of the likely impact on the labour market as a whole, and be invaluable in maximising the chances of success and effective targeting of the Government's various policy initiatives designed to boost growth and job creation.
He said: "Since its initial June 2010 forecast a combination of methodological changes and more precise projections for public spending and public pay has enabled the OBR to reduce its forecast for the total reduction in general government employment between 2010-11 and 2014-15 from 490,000 to 310,000.
While substantial and obviously painful for those individuals, organisations and local areas directly affected, public sector job losses on this scale are unlikely to have a significant impact on the UK labour market overall. Indeed, on the OBR forecast less than 10% of the reduction in general government employment occurs between 2010-11 and 2012-13, a period in which most forecasters currently expect relatively subdued job creation in the private sector."
According to the OBR, more than 60% (190,000) of the fall in general government employment occurs in the single fiscal year 2014-15, by which time it is assumed the economy will be growing at a far healthier rate. Philpott added: "However, the OBR forecasts contradict many independent estimates of the emerging scale of public sector job reductions published by the CIPD and other employers' organisations, trades unions and professional bodies covering public administration, local authorities and the education and health sectors. Such estimates not only point to a larger overall scale of employment reductions but also, and perhaps more significantly for the wider labour market, suggest much larger reductions than the OBR in the current and next financial years."
The CIPD accepts the OBR's modelling methodology as robust and has no desire to talk up the scale of public sector job cuts. But it agrees with the OBR when it notes that its own approach is not ideal but merely the best available 'until the Government obviates the need for a forecast by publishing specific workforce plans.
The CIPD has recommended the Government should, at the earliest opportunity, publish a comprehensive administrative audit of public sector jobs cuts drawn from available figures on workforce reductions being currently planned and/or being implemented across the public sector. Ideally, this would include information on the various ways in which reductions are being undertaken, whether through compulsory or voluntary redundancies, recruitment freezes or natural turnover.
Philpott added: "There is a wide confidence interval between the wilder upper-end of speculation on likely public sector job losses and the most optimistic end of the scale. A comprehensive audit of this kind would help close this gap, giving far greater clarity to ongoing debate about the scale and phasing of public sector job cuts and improving assessment of the possible impact on unemployment at the national, regional and local levels. More importantly, accurate regional and sectoral data will be invaluable in prioritising the efforts of policy makers behind Local Enterprise Partnerships, the Work Programme, Start-Up Britain, and other initiatives designed to boost growth and job creation."
