Job cuts could make personal debt problems worse

In his recent emergency budget the new chancellor of the coalition government, George Osborne, outlined a range of public sector cuts that were designed to cut the huge public deficit, which the new government has squarely blamed the former Labour government for.

However, whilst the cuts may be beneficial to the public deficit many officials have expressed concern over how this will affect private sector jobs, and there are concerns that the impact could result in personal debt problems becoming even worse as a rising number of people lose their jobs as a result of the fallout from the public sector cuts.

The Chartered Institute of Personnel and Development (CIPD) has said that job seekers and workers in all sectors will be affected by the public sector cuts, and whilst the recession may be over the huge cuts announced by the government will take their toll on the jobs sector and could see many people either unable to get work or losing work.

One official said that he was worried about the impact that the government cuts would have on personal debt problems, which are already at sky high levels. Many people have accrued debt over the past couple of years due to the recession and the global finance crisis, and this is a situation that could get worse as a result of the public cuts.

Expressing his concern over the effects of the government cuts on both public and private sector jobs, and subsequently on personal debt levels, Steven Jackson of Beatmydebt.com said: “When the full extent of the government cuts begin to bite, we will see very many families with increasing financial difficulties. This is going to lead to a big increase in the number of people suffering with serious debt problems.”