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Under the Conservatives, there are more people in work than ever before. pic.twitter.com/SCWM2LoAuW
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Growing Service Sector is absorbing more Labour Not a day goes by without some low wage high profile business bregreting Brexit as they fear losing EU baristas with university degrees and they'll be forced to train some dreadful native proles.
People's expectations have changed The generations that entered the work force in the sixties and seventies had strong folk memory of the dire unemployment of the thirties (which was very unevenly spread - for those in employment the thirties were fun, albeit ending badly). Those who have joined post the Thatcher reforms had seen one long march of economic progress - which has now been stalled for a decade - hence their dissatisfaction with their lot. Their older (unsympathetic, Tory & Brexit voting) seniors 'don't get what the fuss is about....as people don't know when they are well off'. Who ever is right is immaterial - its what today's twenty and thirty somethings think.....
On migration, the latest quarter's data (January to March) showed that immigration and emigration levels are almost back to where they were before the referendum. Whether Brexit itself will change things again I don't know.
I think the one aspect not covered here is monetary policy. QE and low interest rates have fuelled a boom in house prices (in London and the South East at least). All first time buyers entering the housing market since 2012 have been thoroughly screwed over.
My biggest worry about all of this is what happens when the house of cards collapses. As @CarlottaVance suggests, people's expectations are very high and people don't realise how bad things can get.
In an interview with The Sunday Times, Harald Krüger said the German car giant was “flexible” on where it made its vehicles.
Although BMW recently said it would build its new electric Mini in Oxford, Krüger made it clear work could be moved elsewhere in the event of a hard Brexit.
“Today already there is a second location for Mini,” he said, referring to a factory in the Netherlands. The car’s battery and motors will be imported from Germany.
https://www.thetimes.co.uk/edition/business/bmw-boss-harald-krueger-warns-that-hard-brexit-hurts-both-sides-zjgq5phjv
Although I think the recent report on work had some tosh (abandoning physical money is a bloody insane idea), the concept of a third category for work (between self-employed and employed, for those in the 'gig' economy) makes quite a bit of sense.
F1: this story made me laugh. Hamilton's going vegan to reduce damage to the planet:
http://www.bbc.co.uk/sport/formula1/41296229
Perhaps international comparison may help? Is this a UK phenomenon or a more widespread one?
Browsing Trading Economics shows that other countries do better in terms of wage growth, despite (or perhaps even because of!) higher unemployment. The Eurozone has 2% wage growth for example, though I am not sure if these are inflation adjusted.
https://tradingeconomics.com/euro-area/wage-growth
Perhaps working tax credits and other in work benefits disincentivise workers pushing for higher pay.
Difficult to get inside the head of a fanatic.
I think the Government's welfare reforms have been successful, but there is still some way to go in getting universal credit working to support those moving into work.
This is one of the reasons for low growth and low productivity. The EU (and UK and other) competition authorities play tough, but they think a competitive market is when there are more than two players - in fact you need at least a dozen. They have waived through merger after merger whose only outcome was to reduce competition - no surprise when you consider competition policy in Europe is not under democratic control. There is no need to really push for productivity when you can make a profit just for being dominant.
This has also resulted in low wage growth - the market for labour has been distorted and large companies know that they control so much of the market that they just don't need to offer that much more (except to the executives of course, who are exempt from this!). At the low end, they just lobby Governments to engage to stupid policies like FOM, which depresses the price of labour and means that they don't need to spend much money on training.
We need a return to genuine free markets, which for a start means a proper competition policy, not a corporatist racket. One of many reasons why Brexit could be a godsend, if the UK were prepared to take the steps to make the most of it.
Additionally the relative ease of laying off surplus workers means that it is less risky to hire as well.
In European countries where it is very tricky to sack people there is much more of an incentive for capital investments - existing workers are more productive and can be paid more, but large numbers of workers are excluded from the benefits of the system.
Anyone would think they're worried that if May does fall, Boris's approach might make both Brexit and the Government more popular.
Betting PostF1: pre-race ramble here:
http://enormo-haddock.blogspot.co.uk/2017/09/singapore-pre-race.html
Includes two tips. One is Verstappen not to be classified at 4. He's got a 46% DNF rate. The other is a weird one, for a tiny stake. It's 67, for Ricciardo podium and no classification for Verstappen, Palmer, and Kvyat. I calculate that at around one in 24, looking at DNF rates of the four drivers involved. Unlikely, of course, but shorter by some way than the odds on offer.
I have reservations about Boris but judging by the outpouring of the remainers and fury from those both here and in Europe you may be onto something with Boris.
And by the way - Cable just announced he could be Prime Minister - you could not make it up
Capitalism is simple. Hire people to make products/services and sell them for a profit. Reinvest the profits to expand and sell more things for more profits.
This has collapsed in two basic areas. The first being that to sell your stuff you need a market of punters wanting to buy. That means they need to have cash. For 8 years wages fell vs inflation, we saw a bit of respite for a couple of years now once again there's a 2% negative gap and it's still growing. "Make work pay" has been a mantra for the Tories yet for millions work doesn't pay the bills no matter how hard they work. And if they can't pay the bills they can't consume. Personal credit has been used to patch the hole but there's only so much credit you can throw at people who can't repay it before it collapsed. Again.
The second area is that "investment" was renamed "subsidy" by ideologue Tories and that has stuck over time. So we don't invest as a nation in transport or education or health or broadband or power generation and industry follows suit, leading to large businesses charging more, paying less for most employees (not the boss man of course, he gets a lot more for being so clever), and not investing.
It's the perfect storm. Keeping the casino banks afloat with their balance sheet full of unrepayable debts packaged as "assets" became all consuming. Why do you think tuition fees trebled with the government paying up front - they added more "assets" to prop up the banks whilst the universities and students grew poorer. Big business lives in terror of the quarterly profit statement in a stock market inflated to absurd levels. And for the people on the ground who want a job that pays enough to keep a roof over their head food on the table and a few fun things like a holiday and a £1,000 phone, life is increasingly impossible. No wonder the other is blamed, the truth is too threatening to our bankist masters.
Austerity was needed to reduce our nation debt they said as debt doubled. They obsess at the loss side of the balance sheet forgetting about profit - how about an economy where people have a disposable income again? A starter for 10 is housing. Most towns are drowning in housing developments as homes become ever more unaffordable. So we need to get the builders building homes people can afford to live in. A ren't cap is essential - it will tip many BTL landlords out overnight allowing the homes to be hovered up by housing associations who let at affordable rents. That frees up cash in the pocket allowing people to spend creating jobs creating cash in the pocket to spend and hey presto, capitalism!
As a Remainer, I am sanguine, it will most likely be a WTO Brexit with no transition period, because that is the default. In practice though there will be no hard border as we are not prepared, so only a theoretical one.
I’m also looking at under/over bets on number of finishers (under 16.5 maybe). Long race of attrition, brakes take a pounding here, there’s always debris around to cause a puncture, and it’s the most physically and mentally demanding race of the season for the drivers - race will go close to two hours around the streets with walls and barriers very close.
pick your economic model
If companies can now lock in profit growth far beyond GDP growth without much trouble, it tells you that there is a problem. In reality, companies are making abnormal profits by restricting competition and depressing wages. Many large companies can easily afford to pay more in labour at the expense of reduced profits and still produce a reasonable ROE - the problem is that expectations have been set unrealistically high in the stock markets.
Better training would improve productivity and this is where profit growth needs to come from, not from pressing down wages permanently and exploiting consumers.
The golden rule of free markets is that you cannot allow monopoly and oligopolies to form as the market cannot function properly in these circumstances. Instead, the West has pretty much embraced a model where these types of entities are actively encouraged.
- free up the market for housing. In particular, allow houses to be built where people actually want to live, i.e. around big cities in southern England, and encourage far more self-build
- give people the right to work from home where the nature of the job allows it, since people are more productive that way
- a more active competition policy, breaking up cartels in areas (such as airlines, builders or financial services) where they increase prices
- ending subsidies to uncompetitive areas like farming. Hopefully now possible at last, at least from 2019
- ending all the "green crap" as David Cameron called it, from uneconomic recycling to absurd energy generation policies.
If the will were there, all these are achievable. However, I fear that, in our polarised and distracted nation, indecision and slow decline are more likely.
I absolutely agree with him on this, indeed if a more sensible leader than Juncker had addressed Cameron's concerns on immigration the referendum would have been won by remain
It is of course true, as Alastair says, that there are additional sources of labour available domestically but I believe this to be less significant because they generally don't have the skills base (older workers may be in a different category).
The problem for our economy is that when you can import skilled and semi-skilled labour from the EU or indeed elsewhere there is little incentive to train your own. Indeed there is a positive disincentive because in doing so you incur costs which put you at a competitive disadvantage. This means that although our young can find jobs they tend to be at the bottom of the food chain with low wages and poor prospects. Such jobs tend to be temporary, casual, zero hours and down right depressing. Its not much of a future and the young resent it. Many of my children's friends have found that they kind of jobs they had part time whilst being students are all that is available to them once they get their degrees and that getting that first "real" job is incredibly hard.
How do we fix this? Obviously some control on immigration will help but only at the margins. Our economy depends on imported skills and we cannot suddenly turn off the tap without causing severe economic damage. We need to focus on why our children are not getting the skills that the workforce wants. We need to seriously incentivise firms to invest in training. What about allowing £2 of tax relief for every £1 spent? We need to restore rigour and funding to our college networks and we need our tertiary sector to work more closely with employers to ensure that they produce what the employers want instead of endless events managers. None of this is a quick fix but our next generation is being dumped on in so many ways, massive debts to pay for our pensions, massive debts from their own largely sub standard education, poor opportunities and limited prospects combined with fiscal and monetary policies that have inflated house prices beyond their reach. In 2017 younger people finally said enough and started to vote. That is a good thing. They have been neglected for far too long.
Mr. Sandpit, I've seen those under/over odds. If it's wet, the under looks tasty. Not much run-off in Singapore.
He is advocating a Brexit based on self belief, with no plan for how to conduct the negotiations. He hasn't moved on at all from the referendum campaign. It makes a cliff edge Brexit almost certain, and ultimately MORE likely that we will end up staying or rejoining the EU.
He is still on 8 on Betfair as next leader, so people aren't really moved by his interventions.
Their support for FOM is an attempt to pay third world wages within first world countries.
Oh yes, it's irony.
Anyone with a pile of spare cash, safety car at 1.16 is free money.
Hamilton to win at 23 is huge value in the rain, as is a lay of Vettel at 1.7.
Alonso to win at 400, for shits and giggles.
However, Boris does seem to have fired up the debate and almost certainly will attrack a lot of support
Were all Corbynites now
Verstappen claimed his engine was slightly down on power in qualifying... which could be an indication it doesn't have much life left. There was also the strange incident in practice where his gears shifted by themselves...
He does seem rather gremlin prone.
Though Amber Rudd on Marr was excellent and I'm not a Conservative. Just for a change, for a politician, clear answers with no avoidance.
The vast wealth of tax havens plus the shanty towns of the third world.
You've even got the 'ten Eastern Europeans in a flat' reminiscent of the old Warsaw Pact days.
Perhaps someone could start doing socioeconomic tourism walks from Hampstead to Harrow.
Forecast is, I think, for drizzle by the start - so wet race, but not undriveable, hopefully.
Makes it quite exciting, and probably improves Verstappen's odds relative to Ricciardo, though not necessarily of finishing.
Problem is that the Tories left on the cretin Byrne's "comedy" note and made the terms interchangeable- "there's no money left" suggests we're broke, something the Tories gleeful,y used to flash compare us to Greece or Portugal despite our being fiscally sovereign. Broke countries running out of cash can't run large annual deficits so the two ended up permanently conflated.
My point remains - our annual deficit is our spending more cash than we raise. The focus has all been on cutting spending (an abject failure despite very real cuts reducing services local authorities and individuals to ruin) with no thought on raising revenue. "We can't raise taxes" they screech. But we can - but growing the economy so that more things are done that are taxable at current tax levels.
As has been pointed out by others, big corporates have oceans of cash generated by paying low wages charging high prices and miniming normal operating costs like training and paying tax. Instead of arbitrarily cutting corporation tax we should have offered it in exchange for investment in wages and skills. Corporations have relied on fiscal policy to fill the gap created by low wages and high prices, a vast subsidy paid to business by the state. This has to stop.
The increase has been through obligatory training to meet legal and QA requirements, especially in health and safety.
You have to start by understanding that the EU has been his life's work. He personifies the EU more than any other individual I know. He certainly misjudged the situation when he played hard-ball with Cameron. He probably realises that now, but don't expect him to admit it.
The UK's exit from the EU was probably as much a surprise to him as anybody. In fact it must have come as a massive shock, especially when it appeared temporarily that Brexit would destabilise the EU and might even cause it to collapse. Had that happened, Juncker would have been identified as one of the chief culprits. Now the danger has passed, he breathes easier. He would certainly prefer to have the UK inside the tent, but can cope with it outside, especially if that increases the solidarity of the remaining members. Perversely, Brexit may actually improve the EU, especially if it causes J and his ilk to focus on some of the flaws that its critics (and many of its friends) have been pointing out for years.
One of the most serious flaws is the sheer number of members. The size of the membership is one of the chief causes of the EU's instability, and nowhere is this more evident than in respect of immigration. What kind of authority creates a 3,000 border with no credible way of policiing it? In practice, the job has been left to individual member States, many of which are poorly equipped to deal with the problem, and have been overwhelmed as a result.
If Brexit causes the EU to start addressing such problems seriously, it may yet prove to be a very good thing - for the EU at least, though probably not for us.
She has the advantage of actually grasping the complexity of Brexit, unlike many of the fantasists that surround her.
People make a lot of assumptions about the resilience of the UK, but it is not unrealistic that a car crash Brexit could result in total state failure.
Assuming that because we were once a great trading nation that we will automatically pick up the Baton again in May 2019 is akin to assuming that because you were once a good athlete you will automatically win gold medals again in the Olympics, even though you've been out of practice for a decade, and notwithstanding the fact you are running barefoot and carrying a trailer.
That is what a car crash brexit would be like.
Great edifices fall. Look at Nokia. No one in the organisation believed that they would fail but they did within a small amount of time.
I am not trying to stop Brexit at all, I accept it has to happen , but making decisions on this scale of enormity based on irrational self belief and gut instinct is insane.
Dear me, I do live a sheltered life.
If having a £1,000 phone is now on the necessity level as having food on the table than the country really is fcked.
Also, Vandoorne's had marginally better reliability than Verstappen, but Alonso is the leader of the reliability failure table.
Mr. Sandpit/Mr. B, Alonso at 400, if it's wet, might be worth a pound or two.
I’ve also got a fiver on Lewis, a tenner laying Vettel and a fiver on under 14.5 finishers at 2.4 - will keep a close eye on hedging for those last two if there’s an uneventful first lap though.
Edit: H&S is probably a good thing on balance.
Brexit means the end of the UK. We need to start being more honest about it.
She really is very poor.
And starting on the third row puts him in the middle of any first corner chaos, however adept he might be in the rain.
H&S is a good thing but much of the statutory requirements do not help, maybe make things worse by distracting from useful H&S practices.
She is even worse than DA
' Ten years ago there were fewer than 10,000 places to buy coffee in the UK and fewer than a third of those belonged to the big chains, such as Starbucks, Nero's and Costa, according to coffee market researchers Allegra.
By the end of last year there were more than 22,000 coffee shops, and branded outlets had doubled in number. '
http://www.bbc.co.uk/news/business-41251451
That's also evidence that there is no shortage of spare money.
It certainly could turn out to be a national humiliation.
Where I think traditional economics really struggles is that it assumes a largely closed system in which effects are predictable within that system. It allows for exports and imports but it does not contemplate economies that are as nearly open as those today.
So, if our government decides to increase spending traditional economics assume that will boost consumption and production. The possibility that that consumption might be met almost entirely by imports with the increase in spending thus dissipated was not contemplated. Keynes talked of a multiplier effect by which £1 spent by government produced several more as those that provided the service for that £1 used services themselves and recycled the profits within the system. This is not where we are.
Tories at it like ferrets in a sack I see...
Bring on Jezza?
http://www.scotsman.com/news/poll-support-for-independence-sees-boost-to-46-1-4562461