Britain’s urban employment statistics suggest that George Osborne totally failed at austerity

Former chancellor George Osborne and his minder on a school trip. Image: Getty.

The latest instalment of our weekly series, in which we use the Centre for Cities’ data tools to crunch some of the numbers on Britain's cities.

Editor's note: we've amended this one, after publiation, following feedback from the FT's economics editor, Chris Giles.

The motto of the monarch of the United Kingdom is, in French, Dieu et mon droit, which roughly translates as God and my right, though it more nebulously refers to the supposed divine right of monarchs.

But if the last government – you know, the one we voted for before the whole Brexit debacle – had a motto, it may perhaps have adopted the French motto Dieu et mes ciseaux – God and my scissorsThe terrible duo tag-team of George Osborne and David Cameron made austerity the buzz-word of the day, and trimming back the public sector was the mission. Snip, snip, George.

Luckily for our purposes, cities tend to be where most publicly funded jobs happen. Local services are concentrated in county towns and regional administrative hubs, while the cogs of national government are overwhelmingly piled on London because it’s, you know, the capital.

But which cities have all the publicly funded jobs? And have all that many of them really been cut?

Without further ado, let’s whip out the stats.

Looking very simply at gross numbers of publicly funded jobs in 2015, the results are obvious.

London comes out miles ahead, with 1.23m publicly funded jobs. Manchester and Birmingham are engaged in a sparring match for second place miles behind, at 294,600 and 284,800 respectively. Glasgow has 169,000, Newcastle has 131,000, and the rest dribble on. (You can hover over a city to see how many it has.)

But obviously gross numbers don’t tell you all that much. London may have 1.23m publicly funded jobs, but it’s a very huge city and thus presumably also has lots of other jobs.

It takes a little bit of mental acrobatics, but the ratio of private to public sector employment is a useful way around this. The basic guide here is that the higher the number, the fewer publicly funded jobs relative to total number of jobs there.

The national average is 2.78: in other words, for every single public sector job, there are not quite three private sector ones. (Or, to put it another way, there are two real jobs and then one spurious thing George Osborne will do every other Friday for £700k a year.)

So Crawley comes top of the list because it has relatively few public sector jobs. For every one publicly funded job, there are 7.18 private sector jobs.

Looked at in this way, London doesn’t seem so extraordinarily far out. In fact, by ratio of private to public sector employment, it’s the eighth least public sector city.

The most public-sector heavy cities. Click to expand. Image: Centre for Cities.

The most public-sector dominated places by this metric are Exeter, at 1.74, Birkenhead (1.58), Cambridge (1.46), Dundee at (1.43), and Oxford at (1.04).

While it might seem surprising to have cities like Exeter, Cambridge and Oxford so far up the list – cities that all come pretty high up other tables of economic success and personal income – one explanation could be the way the data is measured.


Publicly funded jobs is not necessarily the same as what we would conceive as public sector jobs. So while the public sector is normally counted as civil servants, nurses, and police officers, publicly funded jobs could in theory stretch as far as hired private contractors procured by the government for anything from PR to construction, or – as is possible in this case – research and development scientists and engineers supported by government funding to work on some cutting-edge stuff. It’s hard to know exactly.

So. Onto the juicy stuff: austerity. Let’s get a look at those savage graphs showing vast reductions in public sector jobs across Britain’s cities – thousands of inefficient publicly funded lackeys cast asunder in the great name of living within our means, Labour Labour Labour it’s all Labour’s fault, and, This is definitely not just George Osborne’s personal ideological zealotry.

But wait, what?

Most cities come up green on this map, meaning an increase in the gross numbers of publicly funded jobs in cities between 2010 and 2015, or only a very slight decrease.

Not that many cities are yellow, which would show a fall of over 1,100 publicly funded jobs between 2010 and 2015 (the course of the Coalition Government). And London – cue collective eye-roll – gained 138,800 publicly funded jobs over the period.

But again, gross figures can’t tell us everything.

Looking at the percentage change in publicly funded jobs between 2010 and 2015 is, if anything, even more damning for Osborne’s supposed plan.

Only one city, Worthing, shows a decrease of more than 10 per cent of publicly funded jobs over the five-year period, while eight cities saw an increase in publicly funded jobs of more than 10 per cent. Blackburn, out on its own, saw a 20.81 per cent increase in publicly funded jobs.

Which is really quite a lot, when you’ve made cutting back alleged state largesse your central political mission.

Indeed, it’s almost like railing against how big the state is when you’re in opposition and the government has had to take on extra debt to protect the economy from an unprecedented global financial crisis is really easy, while actually cutting back crucial public sector jobs that people rely on for services every day is… kinda hard?

Alternatively, if you wanted to take a much less sympathetic approach: George, you had one job. 

Editor's note: Right, we warned you this was coming. After publication, Chris Giles of the Financial Times said this:

Which was a bit of a downer on the whole.  

We asked Paul Swinney, chief economist for the Centre for Cities, who provides the data, to explain himself. He responded thus:

He added that better data would be nice, but what you gonna do.

So: in these key sectors public employment has risen. Across the piece, not so much.

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What do new business rates pilots tell us about government’s appetite for devolution?

Sheffield Town Hall, 1897. Image: Hulton Archive/Getty.

There have been big question marks about any future devolution of business rates ever since the last general election stopped the legislation in its tracks.

Not only did it not make its way to the statute book before the pre-election cut off, it was nowhere to be seen in the Queen’s Speech, suggesting the Government had gone cold on the idea. (This scenario was complicated further recently by the introduction of a private members’ bill on business rates by Conservative MP Peter Bone, details of which remain scarce.)

However, regardless of the situation with legislation, the government’s announcement in recent days of a pilot phase of reforms suggests that business rates devolution will go ahead after all. DCLG has invited local authorities to take part in a pilot scheme which will allow volunteer authorities to retain 100 per cent of the business rates growth they generate locally. (It also notes that a further three pilots are currently in operation as they were set up under the last government.)

There are two interesting things in this announcement that give some insight on how the government would like to push the reform forward.

The first is that only authorities that come forward with their neighbours with a proposal to pool all business rates raised into one pot across a wider geography will be considered. This suggests that pooling is likely to be strongly encouraged under the new system, even more considering that the initial position was to give power to the Secretary of State to form pools unilaterally.

The second is that pooled authorities are given free rein to propose their own local arrangements. This includes determining, where applicable, a tier split (i.e. rates distribution between districts and counties), a plan for distributing additional growth across the pool, and how this will be managed between authorities.

It’s the second which is most interesting. Although current pools already have the ability to decide for some of their arrangements, it’s fair to say that the Theresa May-led government has been much less bullish on devolution than George Osborne in particular was, with policies having a much greater ‘top down’ feel to them (for example, the Industrial Strategy) rather than a move towards giving places the tools they need to support economic growth in their areas. So the decision to allow local authorities to come up with proposed arrangements feels like a change in approach from the centre.


Of course, the point of a pilot is to test different arrangements, and the outcomes of this experiment will be used to shape any future reform of the business rates system. Given the complexity of the system and the multitude of options for reform, this seems like a sensible approach to take. But it remains to be seen whether the complex reform of a national system can be led from the bottom up. In effect, making sure this local governance is driven by common growth objectives, rather than individual authorities’ interests, will be essential.

Nonetheless, the government’s reaffirmation of its commitment to business rates to devolution and its willingness to test new approaches is welcome. Given that the UK is one of the most centralised countries in the western world, moves to allow local authorities to keep at least some of the tax revenue that is generated in their area is a step forward in giving places more autonomy over how they spend their money. That interest in changing this appears to have been whetted once more is encouraging.

There are, however, a number of other issues with the current business rates system which need to be ironed out. Centre for Cities is currently working on a briefing of the business rates system, building on our previous work in this area, and we’ll be making suggestions as to how the system can be improved.

Hugo Bessis is a researcher for the Centre for Cities, on whose blog this article originally appeared.

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