17/02/2014 06:34 GMT | Updated 18/04/2014 06:59 BST

You Ain't Seen Nothing Yet

Whenever I hear the Bachman-Turner Overdrive 1974 single 'You ain't seen nothing yet' I am immediately transported back to my childhood.

For those who can remember that year it seemed like a pretty dark time.

There were dreadful bombings by the IRA and unemployment was rising because of the oil crisis caused by tensions in the Middle East.

Some right-wing elements became so obsessed by what they perceived to be the threat from trade unions and an apparently socialist Labour government which they believed to be under the tacit control of Moscow that there were plans for a military coup.

However, my own - now faint - recollection is that among most people there was a sense that things would eventually get better.

Back then, of course, we still had a significant manufacturing industry which made up 30% of the economy and the vast majority of employers were under British ownership whether public or private

We are currently being told that the economy is on the mend though even the Governor of the Bank of England Mark Carney cautions us that what we are experiencing is not the sort of recovery that is ideal and that we need to create more jobs that require people with skills in making things such as in manufacturing.

Given that many of the jobs lost in manufacturing over the last forty years - it now accounts for less than 10% of the economy - were in 'traditional' areas of the country such as the North East and North West, to name but two, any increase in jobs that require making real things, as opposed to the service sector, would be welcome.

The reality is that manufacturing is much less labour intensive than back in the 1970s.

So job creation that will ensure manufacturing becomes as significant as it was forty years ago is extremely unlikely.

This makes a recent report by the Institute for Fiscal Studies (IFS) which has examined the planned reduction in public sector jobs all the more worrying.

The IFS report suggests that potentially there could be a 40% reduction in the next five years in employment in the public sector. It is suggested that the effects will be felt most accurately in the poorest parts of Britain that suffered so dreadfully as a consequence of the downsizing of manufacturing commenced in the late 1970s and given added vigour under Margaret Thatcher who so zealously pursued monetarist policies.

According to the IFS the public sector is now as small as it was in the early 1970s and makes up 19% of total employment.

However, by the time the remainder of the proposed cuts have taken place by 2019, the public sector will account for 15%.

For some this reduction probably seems like a good thing and will not only reduce the influence of what they believed to be an overweening state but, of course, reduce public expenditure and debt.

But for those losing jobs in areas of already high unemployment losing there is the prospect of years without work.

Losing a reasonably well-paid and secure job in the public sector may at best be replaced by a less well-remunerated post in, for instance, distribution or retailing.

As George Osborne misses no opportunity to stress, nationally, losses in public sector jobs have been matched by jobs created in the private sector.

However, the areas in which these private sector jobs have been created are not always where they are really required; the poorer regions of the UK.

It is to be noted that these areas tend to be characterised by higher proportions of people employed in the public sector. For example, the IFS report explains that in Wales the percentage employed in the public sector is 28%.

Unfortunately Wales, like other less affluent regions, is not a favoured location for employers wishing to invest and create new jobs.

Contrast this with the South East, especially London, where the public sector accounts for a fifth of employment and where there is a relative abundance of employment opportunities. Indeed, some employers are desperate to find people with the right skills.

Unfortunately the cost of rent is so prohibitive as to deter people with such skills moving from regions of higher unemployment.

The situation is being made worse by welfare cuts which are forcing some people to move away from London and the South East due to the fact that their wages are insufficient to afford accommodation for them and their families.

Moreover, the price of housing, especially in London, continues to increase at an eye-watering rate which means that first-time buyers are effectively excluded.

This seems pretty crazy and surely there must be a better way?

One thing that the government could immediately do would be to commence a programme of building council houses.

This would not only create skilled jobs in construction, but help to alleviate the housing shortage being experienced in every major city.

In the meantime, the words contained in the title of the 1974 Bachman-Turner Overdrive hit single seem eerily prophetic and, for those affected by job losses in areas of high unemployment, add to the pervading sense of hopelessness.