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The jobs debit and credit

Douglas Fraser | 06:35 UK time, Tuesday, 16 February 2010

We're into bank results season. It's Barclays on Tuesday, with its shareholders being richly rewarded for keeping it out the clutches of the British government, and its investment bankers being richly rewarded for handling all that money taxpayers pumped into the economy over the past year.

The most controversial figures will be from Lloyds and Royal Bank of Scotland next week, as they're still on the public life support machine, and showing signs of staying there longer than many had hoped.

Lots more red ink is expected, yet bonuses for RBS alone are expected in the £1.3bn range. It's what Stephen Hester has previously called "the minimum we can get away with".

Halifax closures

But amid the return over the row over bonuses, what's happened to bank jobs? It's been noted before that the carnage many expected has been notable for its absence.

But not so everywhere. There's an interesting new analysis from the European Commission's labour market survey, showing a very mixed picture on banking job losses across the continent, in which Britain has come off relatively lightly, given its prominent role in the sector and in the crisis.

Taking the year from the third quarter of 2008, just before the crisis really hit home, and comparing that with the third quarter of 2009, it's reckoned Britain shed 24,000 finance jobs. That's 2% of the total, and only just over the average for the 27 nations.

More than half of that was down to Lloyds Banking Group, while RBS is reckoned to have shed 12,000 jobs across Europe.

Contrast that with Ireland, which had a staggering 25% decline in financial employment.

Only last week, the reverberations from Halifax Bank of Scotland, once a proud resident of Edinburgh and now part of Lloyds, took another 700-plus jobs out of the republic, as it axed the Halifax retail presence and its 44 branches. That's nearly half the Lloyds jobs in Ireland.

Inward investment reversed

The Slovak Republic lost 23% of its finance jobs, with Belgium and Portugal losing 13 and 11% respectively. Germany, which featured some inefficient Lander lenders, shed nearly 84,000 finance jobs, or 6% of its total.

At the same time, Poland, Bulgaria, Slovenia and Romania were putting on double digit employment growth in the sector, as was little Luxembourg.

Much of Ireland's jobs pain has been down to the rapid rate at which inward investment can reverse and disappear.

And on that front, it's worth noting a row that's erupted in Dublin over good news that came to Prestwick Airport last week. While Ryanair's Michael O'Leary took one of his own jets to Ayrshire to announce 200 jobs in an expansion of its maintenance operation, he had set a fuse burning on an explosive row with Mary Coughlan, his own enterprise minister and deputy prime minister, or Tanaiste.

The failure to convince the Ryanair chief executive to bring the jobs to Dublin Airport, which has just lost more than 700 maintenance jobs recently, is reverberating loudly round Irish politics.

Ryanair's challenge

Indeed, the problem seems to be that relations are so sour between Mr O'Leary and the owners of the capital's airport that he refuses to deal with them at all, and publicly challenges the minister to fight for his business.

What's now clear is that Prestwick won only 200 out of 500 planned jobs, and it's very unlikely to get the others. Talks are at an advanced stage with two other, undisclosed locations and governments somewhere in Europe.

And the challenge has been thrown to Coughlan and the Irish Government to do whatever it takes to win Mr O'Leary's backing.

He's a tricky customer, and a worse adversary. A legal challenge from Easyjet over claims made in Ryanair advertising has just brought the Ryanair response of a non-legal challenge from O'Leary to Sir Stelios Haji-Ioannou; race round Trafalgar Square, possibly with a wheelbarrow or maybe in drag, or settle their differences by sumo or mud wrestling.

Hospital pass

While Conservatives are suggesting hospitals and other public services could be run by co-operatives, we've got new evidence of the difference a good management makes.

The Centre for Economic Performance has just published research showing that hospital services tend to be better when managers have some clinical experience.

They also found hospitals have better management where there are a larger number of competing hospitals nearby - though couldn't that be a factor of being in a larger population centre, with more patient throughput?

However, really, truly amazing is the finding that hospitals in marginal constituencies are "much less likely to be closed" than those in safe seats.

Who'd have thunk it?

Comments

  • Comment number 1.

    Douglas,
    An interesting overview of the job situation. As someone living in Brussels and temporarily 'resting' (un-employed) I spent a few un-productive minutes searching the internet job-boards hoping to find that elusive position.
    A quick analysis showed that of those job being advertised across Europe, the vast majority were for the financial institutions in Brussels, London and Luxembourg. In addition the majority of those were for fixed-term contracting jobs, not permanent positions.
    It is very difficult to find anywhere in Europe a job, contracting or permanent, that isn't for a bank or insurance company. It appears that they are the only organisations that have the money to hire staff
    I was also suprised to find in London, amongst all the banking jobs, a number of highly paid, management positions for various NHS Trusts. So it's nice to know that NHS Trusts also have the resources to pay more managers a nice high salary.

    Strange how the world works these days.

  • Comment number 2.

    Now that Ryanair has solved the employment crisis gripping Prestwick Airport, will some politicians and businessmen now give my favourite airline credit where it is due. Michael has solved the problems of many people across Europe taking advantage of freedom of labour movement to create a better life for themselves, no doubt at some stage some right wing politician will try and make some connection between him and the immigration issue which is no doubt going toi emerge in the next two months as the lection looms and all parties will try and make political capital out of this. As someone directly involved in finding jobs for around 8000 EEU citizens since Accession Day it may be fair to say that
    I have inadvertantly been the single most best customer indirectly of Ryanair.

    It also shows how the international nature of the business world works when Ryanair spurn their native Ireland and relocate 200 new jobs in Scotland.

    Lang may yer lum reek Michael

  • Comment number 3.

    As a non Scot surely the biggest concerns in Scotland re the banks will have to be the RBS and Lloyds results when they come out.

    Both will have to cut the number of branches they have and as sure as eggs are eggs the smaller and worst performing branches will get cut.

    Of the many suggested buyers of branches none seem to be very interested in Scottish branches so I can see many Scottish branches being shut and no one taking them over.

    This will help both RBS and Lloyds cut staff reduce costs and if no one comes in to the area they will retain pretty much all of the custom whilst all the time providing a worse and less convenient service at lower costs per account to them.

    Somehow I can't see Gordon & Alistair releasing the bad news re bank branch sales; closures and redundancies until after the election.

    I may be wrong but I fear I may be correct. I wonder whether the branch disposals will be unevenly spread towards Scotland, Wales and the remoter less affluent parts of England with little in the way of disposals in affluent areas in the South East.

    Anyone want to hold a contrary view?

  • Comment number 4.

    An interesting trap the big banks laid. Snared all the little banks and competitors. Desvastating to the industry, resulting in less choice for the individual, and greater power for the abusers of power. Would be called a quiet coup in other times. They will continue to abuse the public as long as the government lets them. Weakness in the public sector, it has been bought and sold. No one represents the interest of the people and the banks want all the interest they can get.

  • Comment number 5.

    Me, I'm pretty sure that Mr Brown feels quite proud he has managed to chop up Scotland’s banking sector, using taxpayers’ money to pay off the Bank of England to buy the bits that were left up. What next remove Scotland and any reference to it from all banking nomenclature I would think?
    Am pretty sure he feels his evil plan to cripple Scotland, its banks and infrastructure are going better than he could have imagined, even in the darkest corners of his wildest dreams.

  • Comment number 6.

    Heh, I'll bet Mr Brown is getting a good pat on the back just now from his 'Dark Lord Palpatine Mandelson', maybe even the odd grape :)

  • Comment number 7.

    Oh dear! Is that how you spell grape?

  • Comment number 8.

    Worked hard for 30 years plus under the assumption that I was living in a country that cared!
    Well I am now no longer unemployed, but then again I am not employed.!
    So where am I?
    I am currently living with my wife , yes wife not partner, and she is keeping me! So when we see unemployment going up and people claiming Job Seekers going up and we are told, most people get a position within 6 months.
    What jobs are they taking? How long will they be in them?

    I was cajoled in to looking at Double Glazing sales, and jobs in which I had no experience with, in other words like the wee fella who stuck his finger in the Dyke.It will do for NOW!!!

    Also what about people like myself who get no benefits and are officially signed off.

    What part of limbo are we in when it comes to the Government calculating figures.

    I am pretty well educated so....HND....BA ....MBA....

    Please comment if your

    Over 40 , Degree educated, had your 6months JSA , and are now struggling to get any benefits from DWP.. or like me get nothing.Be nice to know who we are and what we could do about it

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