UK: Public and private jobs to be hit by VAT rise and spending cuts

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The government’s spending cuts and the rise in VAT to 20% in January will cost more than 1.6 million jobs by 2016, according to the Chartered Institute of Personnel and Development (CIPD). Both the public and private sectors will be affected, with the CIPD estimating that there will be 725 000 and 900 000 job losses respectively.

Other employers’ groups such as the British Chambers of Commerce and the CBI are more optimistic about the private sector’s ability to create jobs to make up for those lost in the public arena.