Public sector recession 'could be about to start'

15 February 2010 In Business and Economy

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Public sector recession 'could be about to start' The starting gun has been fired for the public sector recession, it has been claimed.

New research from the Chartered Institute of Personnel and Development (CIPD) has showed that almost a third of public sector employers are planning job cuts during the first three months of this year.

According to Alan Downey, head of public sector at accountancy firm KPMG, which helped compile the research, the drastic number of local authorities considering job cuts could mean that the "starting gun for a public sector recession has been fired".

Speaking to the Guardian, Mr Downey said: "It is now only a matter of time before we are faced with the deepest and most prolonged cuts in public expenditure that anyone can remember."

The public sector is also set to lag behind the private sector when it comes to pay increases.
Remuneration in the private sector is expected to rise by two per cent in the next year, while public sector pay is set to increase by just 0.9 per cent.
The figures from the CIPD follow an announcement by the Bank of England that the UK economy was 'bumping along the bottom'.

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