Boris won’t escape the blame for the coming tsunami of unemployment

If the PM thinks forecasts of economic calamity are just Project Fear, he will be proved spectacularly wrong

When it came, the shock was palpable even though it had been expected for months. On January 26 1982, unemployment rose above three million for the first time since the Great Depression of the 1930s. One in eight of the workforce was out of a job.

At the time I was a Westminster political reporter for a newspaper in the North East and, given the region’s dependence on the manufacturing industries hit hardest by the job losses, it seemed that every day brought a new calamity. Coal mines, shipyards, car plants, steelworks were all shutting down, pushed out of business by their low productivity, union militancy and cheap imports from overseas competitors at a time of falling demand brought on by recession.

Exactly 10 years earlier, another Tory government had been similarly rocked when the jobless total rose above one million for the first time since 1936. The fact that, within a decade, another two million were out of work owed everything to the economic mismanagement of the Labour governments of Harold Wilson and James Callaghan. But when the three-million mark was reached, Mrs Thatcher was in the hot seat so she got the blame. Indeed, on the Left she is still blamed to this day. Had it not been for the Argentine invasion of the Falklands just a few months later, she might well have been out on her ear.

Who will be blamed for the next wave of mass unemployment? The latest jobless figures are like a beach before the tsunami hits: seemingly benign but about to be overwhelmed. Despite measures to protect jobs, more than 600,000 people lost theirs in April and May. Hours worked have dropped and vacancies have plunged. The benefit claimant count has shot up to 2.8 million, not far off the figure we saw in 1982.

The big difference now is that employment is far higher than it was then, with far more women in the workforce and millions more jobs. So we don’t need to worry then? By subsidising employment rather than joblessness, the furlough system has kept millions in work, if not actually doing anything. But for how much longer? When businesses that cannot open profitably are asked to contribute more as the scheme is wound down in the summer, they will lay people off.

At a recent economic presentation, the Chancellor and the Business Secretary told the Cabinet that three-and-a-half million jobs could be lost in the hospitality industry if bars and restaurants did not open this summer. We are told that the Prime Minister’s reaction to this revelation was “Christ!” A source reportedly said that Mr Johnson seemed “surprised but also galvanised”. If he was surprised, the virus must have hit him harder than we realise. If he was galvanised, can we see the evidence?

If Mr Johnson really wants to save many of those jobs, he would reduce the two-metre social-distancing requirement to one metre today. No10’s “formal” review of this restriction is a cop-out. It will not be concluded until July 4, which may not be that far away yet could be the difference between survival and bankruptcy. Hospitality companies say they need to know the plans by next Tuesday when rent for the three months from July falls due. If they are stuck with two metres for the foreseeable future, they will not reopen and jobs will go.

The Government knows this, just as it knows that many other countries operate a one-metre rule and that the scientific rationale behind two metres is questionable. So, why the prevarication? One school of thought holds that Boris and his team are paralysed by indecision – but the opposite is the case. They are digging in their heels because they are suspicious of dire predictions. Mr Johnson, his chief adviser Dominic Cummings and many of his ministers are veterans of campaigns in which spurious apocalyptic forecasts were deployed to undermine their policies.

Mr Cummings helped run the Business for Sterling lobby against joining the euro in the early years of the Blair government when supporters warned of economic calamity if the UK did not join the monetary union. It was poppycock. Our economy has performed better than almost all in the Eurozone. Then, during the 2016 referendum, they battled against Project Fear and its insistence that if the country voted to leave the EU the roof would cave in. It did and it didn’t.

No10 does not listen to the economic Jeremiahs because they have been proved wrong before. How often have we heard Boris denounce the “gloomsters” he has accused of hysteria and scaremongering? For someone who has spent years confounding the doom-mongers, it must be tempting to think all the talk of economic calamity is overblown. Look at the US, where the jobs market has started a rapid recovery despite talk of another Great Depression.

The Prime Minister has a plan for dealing with the pandemic and is not going to be pushed off course by a bunch of lily-livered Cassandras predicting disaster. Of course, as a classicist would know, Cassandra was actually right but cursed never to be believed. You can almost hear them in Downing Street saying: “Let’s hold our nerve; it won’t be as bad as they say.” Indeed, apart from a complete shutdown of common sense, that is the only possible explanation. But this time they could be spectacularly wrong.

The service-based economy that has grown dramatically since the collapse of manufacturing and heavy industry in the Eighties relies on people going through the doors of pubs and restaurants, packing out theatres and concert halls, staying in hotels, attending festivals and sporting events, getting their hair cut and nails done, working out in the gym and travelling abroad in droves.

The businesses that underpin these enterprises and the jobs that rely on them cannot survive without the demand currently constrained by unnecessary social distancing and an exaggerated fear of contagion.

Our leaders are encouraged by polling that shows continuing public support for their strategy. But when people survey the wreckage of their lives a few months from now, they will forget that they were rooting for the toughest lockdown possible. They will be looking for someone to blame, and I know who it will be.