Spending more on less
Giselle Cory
There has been a lot of discussion of inflation lately, as prices continue their upward march. The consumer trends data out today from ONS gives us an alternative way of looking at inflation. It shows that we are spending more and getting less on essentials like food, housing and transport. This is shown in the chart below, where solid lines show the amount we are buying and dashed lines the amount we are paying for it (effectively real terms versus cash terms consumption).
Does the Treasury want to link benefits to earnings?
Giselle Cory
Benefits used to be uprated using RPI, a measure of price inflation. This changed to CPI last year. This is also a measure of prices, but crucially it runs lower than RPI. This move generated savings for the Treasury. It has also had an impact on living standards.
For the last few years the UK has been experiencing earnings growth far lower than price inflation (see chart). This has caused a squeeze on living standards. If the rumours are to be believed, it has also prompted the Treasury to ask if more savings can be found by uprating benefits against earnings growth instead of CPI.
Dragging us all down
Matthew Whittaker
With so little to cheer in the British economy in recent years, the steady fall in unemployment since the turn of the year has been seized on as a sign that broader recovery may be around the corner. Yet in truth, the prospects for living standards in the country remain gloomy. And even if growth does return, new research from the Resolution Foundation predicts that unemployment will need to fall by over one million before Britain’s workers can look forward to any meaningful increase in pay.
Looking under the lid of employment figures
Giselle Cory
Employment has gone up and unemployment has gone down. This is good news. But it should not be taken at face value. A closer look at today’s data shows an increase in the number of people involuntarily working in part-time or temporary jobs. As the chart below shows, there has been a sustained rise in the number of people who are in temporary work because they could not find a permanent job. Around 650,000 people are in this position, up from around 400,000 in the mid-2000s.
America’s working women
Giselle Cory
This post originally appeared on Coffee House, The Spectator Blog
We know that the growth of women in work has been a significant driver of household income growth in the UK over the last 50 years. In fact, children are now most likely to grow up in poverty in male breadwinner households.
Today’s publication of the annual snapshot of America’s middle class - The State of Working America – reveals a similar trend on the other side of the Atlantic. As Figure 1 shows, American families with women in work saw their family incomes rise from the early 1970s until the early 2000s. Conversely, families without a woman in work (both couples and single parents) did not.
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Archive for September 2012