It probably won't help so the economy will have to restrict further ie make less, sell less so its a vicious circle. Where I work they have had to cut contract staff substantially but the work , delivery of essential public services, is still there. Its given to remaining staff who dont have the time to do it but it will probably get done eventually but output will be restricted for some time. If in the manufacturing/ services provision areas then yes, there will be little to 'buy' effectively so the amount of money sloshing around will decrease.
The success of the private sector has always relied on public funding support - its always been a synergistic relationship.

I still think the ConDem approach will tip us all into an economic depression as well as the other kind.


PS to Brian; you won't get White British workers taking these hospital cleaning jobs with such low pay, and actually quite hard work.