Tuesday, January 26, 2010

0.1 reasons to cheer

Has recession really ended?

"I've been proven right", announced Gordon Brown yesterday following the publication of figures from the Office for National Statistics indicating a quarterly growth of 0,1% for the first time in two years.

Amidst the flurry of analysis that crowds the paper today, some of which betray hurried optimism, David Prosser in the Independent tells the most interesting story.

His angle is that there's more to the recession than sterile graphs. For example the fact that 1.31m people lost their job during the downturn and, out of those back in employment, "two-thirds [...] are in a new job are earning less than they were previously. The average loss of wages is 28 per cent".

Also, few are saying it out loud, but the foreseeable future is one lined with pay freezes across the spectrum against a background of price inflation and cuts in public spending.

Mass redundancies are still taking place. It may not have hit the front pages, but this morning steel firm Corus announced that its job cuts in the UK will affect 2,500 people. Last week Bosch broke the news that 900 jobs are going to be axed in Wales, followed by Cadbury's own admission that job cuts are "inevitable" amongst its 4,500 UK employees.

Not crowing over the recovery is one thing. Popping the corks of optimism on account of an infinitesimal number (while mass redundancies are still taking place) is another. And it's done in real bad taste.

Also on the subject and explained in a non-arsy accessible language, take a look at this article on thisismoney.co.uk

1 comment:

Matthew Mientka said...

We are feeling the pain of the Great Recession here in New England, too. I wonder what you think of Obama's recent plans to tax the banks, which were undercut by Brown....