In the last week, a range of data and statistics have emerged that show that whilst there are some hopeful signs, there will still be a rough ride ahead for the economy.
The current debate about the costs of caring for the elderly is borne of the recognition that as a society the proportion of those who are “old” is increasing.
Figures released by the Office for National Statistics show that population is not just increasing (projected to be 72 million by 2032 and 81 million by 2060), but that longevity is increasing; there are now some 430,000 people in their 90s.
Last week it was suggested by the Office for Budget Responsibility (OBR) that an additional £80 billion will have to be found each year to pay for the over-65s who, by 2061, are projected to constitute more than a quarter of the population.
It begs the crucial question as to how it will be possible to not just solve the current budgetary problems, but to find additional money. Usually, you look to the next generation to generate the wealth – but there are problems for the young.
A report that has just been published draws attention to the urgent need to address the fact that we have more than a million unemployed under-24-year-olds.
Therefore, it seems, what we have is a potential situation in which those looking forward to retirement have less to live on and youngsters who cannot find work will become increasingly disillusioned.
Neither is good and combined it offers a dreadful vista.
Clearly we need to achieve economic recovery as a matter of urgency to ensure we can look after the elderly and to avoid a lost generation with all the attendant consequences.
The increasing cost of the elderly, both in terms of pensions and associated health care requires a higher rate of activity by the next generation. So, what to do?
Let’s consider where we are in economic terms and it doesn’t look good.
The government’s stated objective of making some £123 billion savings in the next seven years looks increasingly unlikely.
But even if this were possible there would still be a shortfall that would require ever-increased taxes or reduced spending to get back to where we were five years ago.
As the OBR believes, this would mean that we could only look forward to improving public finances until the middle of the next decade. After that, there would be likely to be deterioration in the economy for decades thereafter.
We appear to be entering a potential period in which austerity could become the norm.
If there is any chance of avoiding this we require some adventurous and radical thinking.
As Labour’s Rachel Reeves, shadow chief secretary to the Treasury, suggests, without investment in the economy we risk a long period of “slow growth and high long-term unemployment”.
As we are becoming increasingly aware, finding jobs for the young is an urgent priority. A report, Engaging Employers in Tackling Youth Unemployment, jointly written by the Chartered Institute of Personnel and Development (CIPD), the TUC and thinktank the Institute for Public Policy Research (IPPR) has called for such action.
This report argues that there is a need to create opportunities for all young people, most especially those without qualifications.
The system used in Germany is one in which employers provide training for three days a week and state governments provide the curriculum for classroom study.