The UK Economy Unspun

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According to the government, the UK economy is on the mend due to their austerity policies. Carefully spun figures paint a rosy economic picture. However, beneath the spin, the longest squeeze on incomes looks set to continue and we won’t get a real recovery until people see their real wages rising again...

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The UK Economy Unspun

  1. 1. THEUK ECONOMY UNSPUN! Let’s get started…
  2. 2. According to the government our economy…
  3. 3. According to the government our economy…
  4. 4. According to the government our economy… is on the mend thanks to their austerity policies
  5. 5. However, that’snot entirelytrue
  6. 6. However, that’snot entirelytrue Let’s start unspinning…
  7. 7. 27500 28000 28500 29000 29500 30000 30500 31000 They say: “There are a record number of people in work” Number of people in work
  8. 8. 27500 28000 28500 29000 29500 30000 30500 31000 They say: “There are a record number of people in work” Number of people in work This is technically true but…
  9. 9. 27500 28000 28500 29000 29500 30000 30500 31000 …there are also a record number of people! Number of people in work
  10. 10. 27500 28000 28500 29000 29500 30000 30500 31000 …and here’s how many jobs we’d need just to keep pace with the rising population! Number of jobs needed to keep up with 2008 employment Number of people in work …there are also a record number of people!
  11. 11. 86 88 90 92 94 96 98 100 102 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 They say: “Rising GDP is a sign of recovery” GDP
  12. 12. 86 88 90 92 94 96 98 100 102 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 True, after a slump, GDP is on the rise again… GDP They say: “Rising GDP is a sign of recovery”
  13. 13. 86 88 90 92 94 96 98 100 102 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 GDP GDP Per Head …but growth has been boosted by a rising population …and GDP per head is still lower than in mid 2010
  14. 14. 0 10 20 30 40 50 60 70 80 They say: “We need to slash spending as the national debt is so large” Government Debt/GDP (%)
  15. 15. 0 10 20 30 40 50 60 70 80 They say: “We need to slash spending as the national debt is so large” But, historically, it’s been much larger… Government Debt/GDP (%)
  16. 16. 0.0 50.0 100.0 150.0 200.0 250.0 300.0 1855-56 1859-60 1863-64 1867-68 1871-72 1875-76 1879-80 1883-84 1887-88 1891-92 1895-96 1899-1900 1903-04 1907-08 1911-12 1915-16 1919-20 1923-24 1927-28 1931-32 1935-36 1939-40 1943-44 1947-48 1951-52 1955-56 1959-60 1963-64 1967-68 1971-72 1975-76 1979-80 1983-84 1987-88 1991-92 1995-96 1999-2000 2003-04 2007-08 2011-12 In reality, the UK has had much higher debt/GDP in the past… They say: “We need to slash spending as the national debt is so large” Government Debt/GDP (%) Government Debt/GDP since 1990, as shown on previous graph (%)
  17. 17. The UK economy is finally starting to grow again but the recovery has come three years later than hoped for.
  18. 18. The UK economy is finally starting to grow again but the recovery has come three years later than hoped for. The longest squeeze on incomes looks set to continue and we won’t get a real recovery until people see their real wages rising again.
  19. 19. We need investment in growth and jobs
  20. 20. We need investment in growth and jobs not complacency & spin!
  21. 21. Stayuptodatewiththe latesteconomicnewsat touchstoneblog.org.uk
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