§ Our main objective in the coming years, like that of other countries, must be to reduce the intolerable level of unemployment by stimulating demand in ways which create jobs at home without refuelling inflation. The temporary employment subsidy and other special employment measures which have now been in operation for three years are already providing 320,000 jobs or training places.
§ My right hon. Friend the Secretary of State for Employment announced a powerful reinforcement to these measures on 15th March which should increase this figure to 400,000 by March next year. I believe that in a period of world recession such measures bring immense human and social benefits. Their value is shown by the fact that although the number of men and women available for work has been increasing by 170,000 a year, unemployment has been falling slowly for the last six months and job vacancies have been rising.
§ But we cannot expect to see the rate of unemployment moving down at an acceptable speed unless we can create new jobs particularly in profitable firms in manufacturing industry and so strengthen the industrial base on which our whole economy depends.
§ A Budget stimulus by itself will not necessarily achieve this, because unless British industry can produce and sell the goods required to meet the demand created by any Budget stimulus, that increase in demand will be met by imports and set inflation going again. It will create jobs in other countries rather than our own. After some years in which the level of investment has been lower than normal it is not easy to judge the point at which a demand stimulus may prove self-defeating for this reason, both in terms of jobs and prices.
§ But two things are clear. The key to growth and high employment must lie in an improvement in our industrial performance. And we must design this Budget, like the measures last October, as part of a programme for steady and sustained growth which must cover a period of many years.