Size of state on observe to hit New Labour ranges: Civil Service now employs greater than 5,000 staff

The size of the state is on track to hit New Labour levels – as the civil service now employs more than 500,000 workers.

Research shows the number of Whitehall staff has soared by a third over the last decade, with the number set to rise further after Rachel Reeves unveiled a ‘big pivot’ towards the public sector in the Autumn Budget.

There are now 513,000 full-time civil servants, up 121,000 on 2015 levels.

A forecast by the Left-leaning Resolution Foundation think-tank showed that, by the end of the decade, 18.3 per cent of workers will be in the public sector – just below the 18.8 per cent recorded in 2011/12, a year after Gordon Brown lost power.

Meanwhile, they are earning 6 per cent more than private sector workers after Sir Keir Starmer handed out inflation-busting pay rises to teachers, nurses, doctors and senior civil servants this year.

At the start of 2024, public sector employees were paid 2 per cent more than those in the private sector on average, the research showed. 

And the pay gap could continue to grow as departments have recommended a 2.8 per cent raise next year, slightly above the expected average inflation rate of 2.6 per cent.

Sir Keir Starmer handed out inflation-busting pay rises to teachers, nurses, doctors and senior civil servants this year 

Research shows the number of Whitehall staff has soared by a third over the last decade, with the number set to rise further after Rachel Reeves unveiled a ‘big pivot’ towards the public sector in the Autumn Budget 

However, it is lower than unions were expecting and could trigger industrial action.

The report said that the pivot to the public sector was a ‘striking change in direction – the first we’ve seen in Britain in the past quarter-century outside of an economic or public health crisis’.

The fields in which public sector staff work have also shifted. In 2000, more than half worked in and around local government, but now just one in three does. Health and social workers now make up 37 per cent of government employment, compared to 29 per cent in 2000.

And yet Sir Keir earlier this month declared ‘too many people in Whitehall are comfortable in the tepid bath of managed decline’.

He was then forced to insist he was blaming ‘bureaucratic impediments’ rather than people, after a backlash by trade union bosses who called his comments ‘insulting’.

Meanwhile Cabinet Office minister Pat McFadden recently echoed former Tory aide Dominic Cummings’s call for ‘disruptors, innovators and creative thinkers to join the civil service and boost productivity.

Sir Keir earlier this month declared ‘too many people in Whitehall are comfortable in the tepid bath of managed decline’

His comments came as he launched a £100million

Innovation Fund to deploy ‘test and learn’ teams of problem-solvers to look at major problems in public services.

Ministers also want more tech experts to join the Government for ‘tours of duty’ in the latest phase of the Innovation Fellows Programme, which began in 2021 after Mr Cummings left No10.

Resolution Foundation researchers also warned of a fall in disposable income next year due to the impact of Chancellor Ms Reeves’s £25billion tax raid.

But it said improved public services mean those in the lower half of incomes will be the equivalent of £28 better off while the top half will be £140 worse off. The top 10 per cent are on course to lose out on an average of £356 next year, but the outlook for the poorest 10 per cent is ‘dire’, it warned.