Message From The CEO of East Lancs Chamber of Commerce

Date published: 25 June 2010

Is Business About To Get The Proper Respect For Creating Employment That It Merits?
Among the excitement, and occasional bewilderment, that has come with the change of Government, it could be easy to lose sense of scale of the implications of the mild-sounding phrase 'rebalancing the economy'.

At one level, understanding what is required for the public sector side of the equation is easy. The size of the state has to reduce, and that means some combination of wage freezes or reductions, job losses through natural wastage or redundancy, and improved productivity. Unlike the private sector, which has recorded 20% plus efficiency gains in the last decade, the public sector has stood still - and this despite the availability of improved technologies. There is also the time bomb of civil service pensions, where our local businesses generally see an unfairness in their earlier retirement age and protected final salary pensions while making the comparison with their own prevailingly money-purchase schemes and older retirement ages: and all that while public pay has overtaken the private sector.

However, by far the harder task is replacing job reductions in the public sector with employment in the wealth creating economy. In Pennine Lancashire, there are 50,000 on the public payroll - as many as work in the main industrial sector, manufacturing. And manufacturing is continuing to reduce its workforce as it continues to increase its productivity.


To grow any business, as any business man or woman will tell you, is difficult - whereas creating 'jobs' in the public sector has simply required a stroke of the Chancellor's pen (at one point it was believed by the grant regimes that jobs could be created in the private sector by donation of an £800 public grant!)

However, we are an industrious and innovative lot in business and will find new markets and sectors given the right climate. British Chambers of Commerce have had an open door to the new Chancellor and Business Secretary, literally since the day of their appointment, and are making the argument for what the business community needs. And the early signs that they are listening, for example on scrapping the N.I. increase, are promising.

Let's see if Government's resolve holds in both reducing the public sector and creating the climate for business employment growth - they are different subjects.

Mike Damms
Chief Executive