Posted by: timdodds | October 11, 2007

Shock reliance on the State

In The Times today there are disturbing statistics at how reliant parts of the UK are on the state for their employment. The data comes from Cebr – Centre for Economics and Business Research. [NOTE: I've signed up for their monthly one page briefing called 'The Forecasting Eye']

That for many parts of the UK the state provides more than 50% of economic activity is seriously worrying. I guess we’ve all seen and understood the growth of state based employment and activity, but to see it the figures broken down by region is the real shocker.

The state is not a wealth creator, it’s a wealth consumer, and it’s eating up our wealth at an ever increasing rate. I’ll not dwell on the arguments about reasons and consequences, but let the dreadful figures speak for themselves.

State spending as a proportion of national or regional income, 2007 estimates

  • Northern Ireland 70.5%
  • Wales 64.3%
  • North East 63.0%
  • Scotland 55.6%
  • North West 54.0%
  • France 53.2%
  • Sweden 52.4%
  • Denmark 50.1%
  • Italy 50.0%
  • Yorkshire & Humberside 49.5%
  • Belgium 48.6%
  • Finland 48.2%
  • West Midlands 47.1%
  • Portugal 46.6%
  • Netherlands 45.7%
  • United Kingdom 44.1%
  • Germany 44.1%
  • East Midlands 42.1%
  • South West 42.0%
  • Poland 41.9%
  • England 41.0%
  • Spain 38.5%
  • Japan 38.4%
  • East of England 38.3%
  • United States 34.9%
  • Ireland 34.1%
  • Australia 34.0%
  • South East 33.5%
  • London 31.4%
  • South Korea 29.2%

I’m going to come back to this topic about the frightening speed with which we’ve moved from an enterprise economy to a state-controlled economy, and I’ll try and match this data to other sorts of data on enterprise, benefits, employment and such. It may take time, but I think it might be worth it.

We must shine a searchlight onto this worrying change to our economy.


Responses

  1. Very interesting and worrying.
    I suppose I have to ask what you think the correct level of state spending should be?
    It surely can’t be 0% or 100%.
    I like the idea of it being nearer to 0% myself.

  2. conceptualizer

    Good comment. The main thing is to firstly turn the tide in the other direction, then perhaps we can start to talk about what the correct percentage should be.


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