I’m worried that my blogs are becoming a little predictable with their gloomy outlook on the economy and the world generally. All I seem to do is write bad news stories although arguably I just write about what I see. However even I was starting to get down so this week I wanted to find something positive in the economy to write about. I was determined to find some good news.
And on the face of it I found some.
So three cheers then. The Office of National Statistics claims unemployment is down. And inflation has fallen. I guess therefore we can celebrate and go on a shopping spree down the High Street then.
Sadly not the case. It is true that unemployment has fallen by 26,000 in the three months to May. This is particularly heartening for the 16 - 24 year olds where the latest figures show a drop of 42,000 in the three months to May to 917,000. However looking beyond the headline figures there are more worrying statistics. For example, the claimant count is up rising 24,000 in June to 1.5m, there are 5.4 unemployed people vying for the same job plus there is evidence that most young people are putting off looking for a job and are going back into full-time education which accounts for the drop in figures. (The real test will come in September with the yearly influx of school-leavers and graduates into the market.)
And what of inflation? Well it turns out that the reduction in the CPI was largely due to the early summer sales, with prices for games, toys and audio-visual equipment all falling. The cost of staples – such as bread, meat, fish etc- continue to soar and will add to concerns about household finances. So despite the surprise drop in inflation, economists still reckon CPI is likely to breach 5% in the autumn as higher utility bills kick in. So the analysts say this is a blip.
Ah well. I did try…
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