Swift action to cut the UK’s debt could hamper economic growth and job creation, according to Dr John Philpott, chief economic adviser at the Chartered Institute of Personnel and Development (CIPD).

Yesterday, the Office for Budget Responsibility (OBR) predicted that around 600,000 jobs would be shed in the public sector over the next five years.

Philpott says: “As the CIPD also said during the General Election, a dynamic economy with almost 30m people in work, which in a normal year is capable of more than making up for the 0.5m jobs lost as a result of annual improvements in labour productivity, should be able to cope with a phased period of large scale public sector downsizing without this resulting in higher unemployment.

“But a favourable outcome depends on a return to health of the wider economy and increased demand for labour from the private sector. The conditions necessary for such a favourable outcome are at present far from self-evident and unlikely to emerge simply as a consequence of swifter and tougher action to reduce the deficit.”