§ 7. Mr. Dormand
asked the Secretary of State for Employment what proposals he now has for reducing unemployment.
§ The Secretary of State for Employment (Mr. Tom King)
The Government's economic strategy is directed at creating the conditions in which industry can improve its competitiveness and so generate real, lasting jobs. In addition, we are continuing to promote a number of special employment and training measures.
§ Mr. Dormand
Is the Secretary of State aware that, despite what he has just said and the repetition that we hear about the recovery, unemployment in the northern region is still rising and remains at the highest rate in the United Kingdom outside Northern Ireland? In addition to what my 756 hon. Friend the Member for Jarrow (Mr. Dixon) said, may I ask the right hon. Gentleman to persuade the Prime Minister to come to the north east and stay for a week on supplementary benefit, as experienced by the hon. Member for Derbyshire, West (Mr. Parris)? Will the right hon. Gentleman remind the Prime Minister that people there remain unemployed for months and years with little or no hope for the future? What will he do about that?
§ Mr. King
I referred in my answer to the special employment and training measures that we are taking. Undoubtedly unemployment is extremely serious, and every hon. Member who knows anything about the north east knows the problems that it faces. I notice that in Peterlee and Wearside— areas of interest to the hon. Gentleman—8,000 people were placed in jobs last year; that in the Durham area there were 5,700 entrants into the youth training scheme; and that in Durham and south Tyne there are 6,500 people currently on the community programme. It can be seen that part of the substantial expenditure of nearly £2 billion that the Government are putting into training and special employment measures is helping to allieviate a difficult position in the north east.
§ Mr. Stokes
Does my right hon. Friend agree that management and trade union leaders have a responsibility to see that wage rises are contained if unemployment is to be reduced? Is he not disturbed in that regard by the latest figures produced by the CBI yesterday?
§ Mr. King
I am anxious that we should recognise the importance of keeping inflation down and ensuring that British industry remains competitive. I am encouraged to see that in the latest survey by "Manpower", the 1,260 leading employers in this country now say thatthe first three months of 1984 will be more favourable for job prospects than any comparable first quarter of the year during the past four years.Those are encouraging signs of the gains that can be made. It is important to ensure moderation in wage bargaining.
§ Mr. Strang
Has the Secretary of State estimated the financial cost to the Government which would arise from the additional unemployed resulting from any closure of Scott Lithgow?
§ Mr. King
We face some extremely serious consequences in a number of industries which are uncompetitive at present. We are not isolated. The hon. Gentleman will have seen in The Times today that the Socialist Government of France are forecasting privately that over the next three years 500,000 jobs will go in coal, steel, the shipyards and the car industry. Therefore, we must be realistic about the problems that we face.
We now see better employment prospects. For the first time for four years the figures for the last quarter show an increase in the number of jobs in this country and possibilities of people being in work. That is an important development.
§ Mr. Kenneth Carlisle
Does my right hon. Friend accept that it is an outdated fallacy to believe that any Government can create jobs out of the blue? In reality, jobs are made by producing a product or providing a service that someone wants to buy.
§ Mr. King
The feature of the past four years is that, while there has been a considerable growth of jobs in service industries, there has been a greater loss of jobs in manufacturing. The latest figures available to me show 757 that the erosion of jobs in manufacturing has now stopped. It looks as though there will be 250,000 new jobs in service industries this year and that during the last quarter there may be a small net gain in manufacturing jobs.
§ Mr. Wrigglesworth
What the Secretary of State has just described will make hardly a dent in the unemployment figures. Will the right hon. Gentleman study what is happening in other countries, such as France and the United States, where increasing demand within the economy has brought about 18 per cent. growth in industrial output during the last quarter? Will the Government reconsider their economic policy and stimulate demand to get people back to work again?
§ Mr. King
The hon. Gentleman was not listening to my first reply. I do not believe that that will have any impact on unemployment. If, as my hon. Friend the Member for Halesowen and Stourbridge (Mr. Stokes) said, we show sense by wage moderation and by remaining competitive, that will have a great impact on unemployment.
§ Mr. Cormack
Does my right hon. Friend accept that our right hon. Friend the Chancellor of the Exchequer could make a significant move forward on 13 March by abolishing the national insurance surcharge? Will he urge his right hon. Friend to do that?
§ Mr. King
I shall not anticipate measures that may be introduced by my right hon. Friend the Chancellor of the Exchequer. However, it is necessary for the encouraging recovery to continue. A survey among all the members of the Institute of Directors shows that there are now more encouraging prospects for its members. That must not be put at risk by increasing public expenditure, or the public deficit, which could seriously damage interest rates.
§ Mr. John Evans
Will the Secretary of State confirm that the spiralling decline in this country's manufacturing industry over the past four years has been deliberately created by the Government's activities, especially in areas such as the north west and Merseyside? On Friday night, a further large group of redundancies was announced by BICC. Will the right hon. Gentleman tell the House whether he expects employment in manufacturing industry to rise over the next two years?
§ Mr. King
If the hon. Gentleman is suggesting that that has been a deliberate policy, perhaps he will also suggest that the Socialist Government of France have adopted a deliberate policy to lose 500,000 jobs in the next three years. That is the reality that modern industrialised countries have to face in the very painful period of transition to the use of new technology.