Investing in the poor now will save us a billion in the future

The topic of the day is unemployment. At the moment, more people in the UK are unemployed than they were before Labour came into power. Not a nice reflection on the track record of the current Government. Why were so many jobs lost? Of course, the financial crisis. Always the financial crisis. However, looking at the types of jobs that are lost, many of those would have been low-skill jobs in the service sector that are expendable when the going gets tough. Demand for dry cleaners, office cleaners, caterers and sandwich sellers disappears quickly when the people demanding these services (i.e. those working in financial institutions) find themselves out of a job as well. So, all we have to do is make sure these financial wizards get their jobs back, so that those caterers and cleaners can get back on track, right? Wrong. What the crisis very clearly shows is that a lot of the employment created through the bubble was fleeting, just as the billions or even trillions of pounds that have now vanished into thin air. The jobs were not embedded in the real economy, the manufacturing of goods or the provision of services that we all need every day – for example good quality child care. Instead, people worked hard for measly incomes, were mostly unable to save, and loose the few assets they have, e.g. cars (which are often needed in order to get a new job). At the same time, they can’t honour credit commitments any more, meaning they are frequently over-indebted – or have already applied for personal insolvency. The latest stats show another increase in this
number.

 

http://neftriplecrunch.wordpress.com/2009/08/18/investing-in-the-poor-now-will-save-us-a-billion-in-the-future/

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