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Everyone likes a surprise – this week we got two. First we learnt that a Conservative government will openly seek to increase public spending by both borrowing more and raising taxes. And then, even more shockingly, it turns out that England are not in fact legally barred from winning the opening game of a World Cup.
The first surprise is all the more poignant given that today marks the 8th anniversary of George Osborne’s emergency Budget in June 2010. Its key argument that spending cuts should be deep to avoid big tax rises has now been well and truly binned. The ex-Chancellor must be spinning in his editor’s chair…
The good news, for those of you trying to accumulate new jobs at the same pace as George Osborne, is that we’re hiring. If you want to change the world one chart at a time come work at the Resolution Foundation. We’re looking for people to do cutting-edge research and to help communicate the findings far and wide. Details here.
Have a good weekend,
Director, Resolution Foundation
Charts and minds. Hold the front pages – this is the big one this week. It turns out that the answer to fake news and the decline of truth is….. charts! We are not making this up. A report on how to combat basic misperceptions about issues like 9/11 highlights this new paper that found ‘providing participants with graphical information significantly decreases false and unsupported factual beliefs’. So yes – charts really are the top way to enlighten the general public, and they do so more effectively than the same information presented as text. Most importantly, charts are particularly effective in correcting misinformation – while text can rile people up and be easily rejected, pictures communicate information differently and can prime people to be more open to new perspectives. Charts 1, Donald Trump 0.
Caring for the minimum wage. What are the big rises in the National Living Wage doing to our economy? There isn’t much evidence yet, although we’ve found no big impacts so far looking across the economy. A new study (an older open access version from April is here) provides a deep dive into what the particularly sharp 2016 rise meant for the care homes sector – which is stuffed full of low paid (and undervalued) workers. The results: wages went up a lot without hitting employment or firms going bust. Less encouragingly, care homes seem to have adjusted to the increased costs by reducing the quality of service they provide…. This serves as a reminder that we collectively underfund social care: you get what you pay for. As an aside, the study finds that despite the National Living Wages pay rises being for people aged over 25, the benefits have spilled over into higher wages for under-25s.
Labour productivity. John McDonnell wants to make the country more productive. Or rather he wants the Bank of England to. On Wednesday Labour’s Shadow Chancellor launched plans to change the Bank of England’s remit: rather than just targeting 2 per cent inflation the Bank would also have a 3 per cent productivity growth target, with close coordination of monetary policy with a regional/sectoral industrial strategy. The 3 per cent bit is…. ambitious. But more interesting is the underpinning philosophy of giving even more power to the Bank of England. This is the opposite of what many on the left want and there is definitely an important debate to be had about whether handing ever more power over to technocrats is good for democracy – as an interesting recent book from an ex-Deputy Governor of the Bank of England has argued.
Broken (social) elevator? An OECD report released earlier this month from their inequality research groups looks at social mobility across its member states. Its basic finding is that families and communities have since the early 80s been getting stuck more often on the lower rungs of the social ladder – both in terms of earnings and occupational status. The average OECD country also has a ‘sticky ceiling’ which rich families adhere to strongly, while it takes five generations for children from poor families to reach their country’s average income. Something for the new Social Mobility Commission Chair to get her teeth into…
Chart of the week. If charts win minds, then prepare to be converted next week when we publish a 57-chart guide to the past, present and future of living standards across London. Now, everyone knows London is a housing disaster zone, but it’s not just about soaring house prices and plummeting home ownership. Wider shifts in how Londoners are housed are staggering in their scale. As the chart below shows, the starkest decline has been in what used to the most common tenure in Inner London – social housing. And the most common way to live in Inner London today? Shared private renting. Turns out people that grew up watching Friends have ended up emulating it – but in Marylebone not Manhattan. If you want to know more about living standards in London, we’re launching the report at an event on Wednesday with MPs Jo Johnson and Rushanara Ali, which you can catch here.
Housing tenure across London, 1990 and 2017