Analysis of the state of the economy shows the authorities were premature to celebrate a return to pre-crisis levels of GDP. The population has risen since then, so the money now in the economy does not go as far; the employment rate might be where it was before the recession by the net increase in jobs is almost entirely due to part-time and self employment, neither of which pays as much as full-time employment (on average). Real average earnings are estimated to be more than 12 per cent lower than before the recession. So where has all the money been going?
It seems George Osborne is reckoning on a big tax boost in January when self-employed people provide their tax returns. We must all make a note in our diaries and see how well THAT turns out!
The final words make it clear that even people who are paid to understand these figures have no idea where to go from here – so all the government’s fine talk is twaddle.
This was a watershed month for the UK’s slow recovery, with a number of things finally getting back to where they were before the recession. In July, GDP, the employment rate and the number of full-time jobs edged above 2008 levels. The FT did a celebratory piece this weekend with some great charts from Chris Giles.
When you look at the per capita figures, though, things don’t look quite so good. The population has risen since 2008, so, once you divide it up, 2008’s GDP doesn’t go as far.
The employment figures tall a similar story. The rate might be back where it was before the recession but the net increase in jobs has been almost entirely due to part-time and self employment.
As Michael remarked:
Put plainly, what it shows is that the recovery of the employment rate to previous levels has been driven entirely by growth in numbers of people who…
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