The economy grew by 0.3% in the first quarter of 2017, down on 0.7% in the final quarter of 2017. More than 80% of the first quarter growth was driven by business services and finance. As the chart shows, the increased contribution here (in light grey)…Read more…
Too early to call time on the consumer spending boom
Retail sales have seen their worst decline since 2010. But rising consumer credit figures suggest we’re not at the end of the consumer spending boom just yet. Retail sales volumes declined by -1.4% in the first quarter of 2017, the worse quarterly decline since the first quarter of 2010 (itself…Read more…
100% Business Rates retention should support local economic growth
The government’s Local Government Finance Bill 2016-17 is set to make some radical changes to the way local government will be financed through local business rates (BRs) within England. At present, local government can retain 50% of business rates (BRs), which are essentially a tax on…Read more…
In the Budget Philip Hammond said rising real wages were ‘most important’ – what happened?
8 March 2017, Philip Hammond’s Budget Speech: And most importantly, Mr Deputy Speaker, despite higher-than-target inflation, real wages continue to rise in every year of the forecast. [my emphasis] 12 April 2017, only five weeks later, statistics from ONS Labour Market statistics release…Read more…
How Washington D.C. speaks for Roosevelt’s monumental economic vision
“I pledge you, I pledge myself, to a new deal for the American people”, FDR accepting his nomination as presidential candidate, 2 July 1932 credit: Ron Cogswell Preamble Every two years an international Trades Union Confederation delegation from across the world meets with officials…Read more…
A note on the economic impact of Roosevelt’s New Deal
This post is brief background to a longer piece that views Roosevelt’s economics through his impact on Washington D.C. The economic statistics show his initiatives brought the US great depression to a decisive end; they also stabilised the deterioration in the public sector finances. Yet the…Read more…
BEIS Committee of MPs says workers on boards should become “the norm”
The BEIS Parliamentary Committee reports today on its corporate governance inquiry launched last autumn. There is much to welcome in its recommendations, which span workers on boards and remuneration committees, board diversity, executive pay, private companies, directors’ duties and enforcement….Read more…
Nowhere slowly: failures on private debt follow failures on public debt
Today’s figures confirmed what we already knew: that economic growth in 2016 was entirely reliant on the consumer. We also know that workers are in the middle of an unprecedented decline in real wages (at least since Victorian times). So the inevitable result is lower saving and increased growth in…Read more…
Controversies around inflation measurement: Have annual real wages fallen by £2,100 or £1,200 or £800?
Whatever way you look at it, this week’s inflation figures illustrate the threat to living standards that result from the fall in sterling after the referendum. Headline inflation in February rose to 2.3%. Last week’s average earnings data for January (regular pay) was 2.3%. Real earnings growth is…Read more…
Double whammy means biggest monthly hit to real pay growth since financial crisis
Pay growth down and inflation up means the lowest real pay growth for more than two years, and the sharpest decline on the month since the global recession in 2009. Average earnings growth slowed to 2.3% in January 2017 from 2.6 % in December Inflation…Read more…
#Budget2017: Boost for technical skills funding
As with much of the Budget, the package of skills measures contained few surprises as the various announcements had been trailed extensively beforehand. Nevertheless, there is much to welcome in the Budget on technical education and skills, in particul…Read more…
#Budget2017: Self-employment tax changes
Increases in taxation of self-employment may raise more money for the exchequer but will do little to clamp down on bad employers who force staff into bogus self-employment to lower their tax bill Today’s standout Budget measure was the increase in the tax paid by the self-employed, with the rate…Read more…
#Budget2017: Zero out of four
Yesterday we set the Chancellor four tests for whether his Budget would deliver for working people. Today we have no good news to report. This wasn’t a budget for living standards, it didn’t give the British economy the investment it needs to see us through the uncertainty of Brexit, and public…Read more…
Four tests of whether the Budget delivers for working people
As she started her campaign to be Prime Minister, Theresa May promised to put the power of government in the service of working people. So far, there’s little sign that the Chancellor has got the message, with his pre-budget interviews focusing on ‘fiscal discipline’ at the same time as pressing…Read more…
Unions must be at the heart of industrial strategy
Two bits of news caught my eye today. The first was new figures showing the number of workers on zero hour contacts has hit an all time high – with over 900,000 people now working on contracts which leave them wondering how much they will be earning from day to day, week to week. This…
The…Read more…
UK 103rd out of 112 in global ranking for real wage growth since the crisis
Over 2008 to 2015, UK real wages fell by 1% a year. This puts the UK 103rd out of 112 countries for wage growth over the post-crisis period, on the basis of International Labour Organisation figures. The average wage growth across all countries was +2.3% a year and the median +1.6%. There were…Read more…
Investment decline + reliance on consumers = bad news for the economy
The new official GDP figures out today paint a worrying picture for the longer term, despite many of the headlines. Our economy is severely imbalanced – totally reliant on consumer spending to stay afloat, with no sign of the Chancellor’s promised rally in investment. That’s…Read more…
Budget blogs: Looking to the longer term
So far this week we’ve outlined the main challenges facing the Chancellor as he prepares his budget, and looked at the sharp rise in insecurity at work, and the hole it’s punching in the public finances. Today’s post looks at the longer term challenge of producing more good jobs and an economy that…Read more…
Budget blogs: The fiscal cost of insecure work
Yesterday’s Budget blog focused on challenges facing the Chancellor as he prepares for the last Spring Budget. New TUC research out today shows why tackling the rise of insecure work should be high on the Chancellor’s agenda, revealing the £4bn a year cost of the rise in low-paid self employment…Read more…
Kerslake review of Treasury warns that austerity has failed
Today Lord Kerslake (the head of the home civil service, 2012-2014) published his independent review of the Treasury, with launch events in London and Manchester. The report was commissioned by Shadow Chancellor John McDonnell; TUC General Secretary Frances O’Grady was on the panel amongst others…Read more…