The big let down of the post-crisis recovery has been the failure of wage growth to ignite in the face of an ever-tigthening labour market. Will 2018 finally be the year it changes? Prolonging the recovery might depend on it. Service charge included. The UK economy’s largest sector is losing momentum as it approaches year...Read More
After the sobering downgrade to our prospects for productivity growth comes the scramble for solutions. The new industrial strategy, if fulfilled, is a good place to start. Thinking ahead. If Britain’s productivity matched the world’s best we’d be £10,000 a year better off on average. The new industrial strategy aims to win this prize with...Read More
Last week the UK got a downgrade. Its growth prospects were slashed by the Office for Budget Responsibility in the all important area of productivity. If it’s correct, the country faces another decade of very challenging economic circumstances having just gone through one following the financial crisis. Sobering stuff. The stamp duty change grabbed much...Read More
Productivity growth – the UK’s Achilles heel – strikes again. The downgrade by the OBR in the UK’s ability to generate productivity improvements in the coming years was striking. With our prospects diminished it left the Chancellor with little room for big giveaways. But at least first-time buyers will rejoice! Ouch. The Office for Budget...Read More
“Global growth remains strong.” That was key judgement number one underpinning the Bank of England’s forecast in the most recent Inflation Report. The Eurozone has been at the heart of the improvement to the global economy over the past 12 months and, in turn, that’s been supportive to the UK. Can it all continue? Very...Read More
Bank of England Governor Mark Carney has taken some flak for talking about interest rate rises in the past, but not delivering. That ended last week when the MPC’s raised Bank Rate. Now to see how the economy responds. Take a hike. The Bank of England delivered its first rate hike for 10 years, raising...Read More
It wasn’t blockbuster but GDP growth was slightly better than expected last quarter, lending a little support to members of the Bank of England’s Monetary Policy Committee minded to raise rates this week. But will it be enough to get a rate hike over the line? We’ll find out lunchtime on Thursday. Slow growth. The...Read More
It’s a familiar narrative for the UK. Strong job growth but signs of a weakening consumer on the back of paltry income growth squeezed by higher inflation. Yet markets are convinced the Bank of England is raising rates on 2 November. The latest data suggests the decision will likely be more finely balanced for policy-makers....Read More
With unemployment at a 40-year low, wages should be rising at roughly twice their current pace. That they are not reflects rising supply, a shift to self-employment, less job switching than usual and, above all, stagnant productivity. It can also stump central banks used to the conventional relationship between work and pay. Jobs for...Read More
Often left in the shadow of a resurgent service sector, finally it’s the manufacturers’ time to step into the sunshine. Revving up. British industry made a good start to Q3 as output rose by 0.2% in July. Manufacturers shrugged off higher import prices and expanded their production by 0.5%. The new car market might...Read More
