The Chartered Institute of Personnel and Development has warned that cuts in public spending and the rising rate of VAT will result in the loss of almost 1.6 million jobs across the UK economy by 2015-16.
It is the highest estimate yet of the effect of the coalition Government’s spending cuts, but the CIPD say other estimates have failed to take into account the effects of VAT rise.
The CIPD estimate is that the public sector will lose 725,000 jobs, compared with the 490,000 figure given in the Comprehensive Spending Review.
It also predicts that 900,000 private sector jobs will go - 650,000 as a result of public-spending cuts and another 200,000 resulting from the VAT increase.
The CIPD adds that an average of 320,000 private sector jobs a year would have to be created by 2015-16 just to keep unemployment steady at 2.5 million.
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