The UK government could fire 300,000 people and the number may rise to 700,000, according to the Times of London. The nation has an estimated £156 billion budget deficit. Governments in Greece, Spain, and Portugal are taking similar measures by lowering government worker salaries and starting layoffs.
The trouble with the massive cuts in all four nations is the extent to which they are regression. UK GDP was up only .2% in the first quarter of 2010 ,meaning it would take very little to tip the nation into a second recession. The 300,000 laid-off workers will have to receive some level of support from the government, which will expand the cost side of the budget. The unemployed will certainly cut into the UK’s tax and consumer base. Those factors would almost argue for keeping the workers employed.
Douglas A. McIntyre
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