Ashwin Kumar

We don't really have a definitive explanation for inactivity being higher than pre-pandemic. Other possible explanations include healthcare backlogs so more people too ill to work or that, post-pandemic, more people decided to accept a lower income in return for more time with their grandkids

But it is VERY far from a jobs crisis (as one journalist put to me in an interview this afternoon). 🧵 /end

Finally, average wage growth has slowed to 5% a year. This is still comfortably above price growth (inflation) but by slightly less so. This is evidence of a degree of restraint from employers as they deal with minimum wage rises and employer national insurance increases. 🧵 /11

So we have two contradictory pictures: employment up according to the Labour Force Survey but number of employees down according to HMRC data: that’s the key info to report, not the unemployment rate whose importance depends on what’s happened to inactivity/employment. 🧵 /10

So they recommend looking at stats on the number of employees reported by their employers to HMRC for shorter-term trends. This shows a small fall in the number of employees in the most recent period. 🧵 /9

But – yes there is a but – there have been problems with the Labour Force Survey in recent years. Not enough people have responded to the survey, increasing uncertainty around its results. The ONS have been working on this but short-term comparisons still suffer from volatility. 🧵 /8

Because of these complexities, the unemployment rate should NOT be the focus of reporting every month – the employment rate is much more useful. What matters most is if people are working, not how hard they are trying to find work, which is what the unemployment rate measures. 🧵 /7

Essentially, according to the Labour Force Survey, the rise in unemployment came from a drop in inactivity, not a drop in employment. If more people who were previously not doing so start looking for work, that’s a good thing. 🧵 /6

When you do this, despite unemployment rising a bit, the Labour Force Survey employment rate rose a bit as well. How is this possible? Because the inactivity rate fell quite a bit – by 0.4 percentage points. 🧵 /5

That’s why the government has made a priority of supporting people who are classified as ‘inactive’ to look for work. So, reporting of the monthly labour market stats should NOT focus just on the unemployment rate but on the employment rate so that the inactivity issue doesn’t get ignored 🧵 /4

It is a more serious problem for the economy if people have health problems or believe there are no jobs and stop looking for work. This ‘inactivity’ is much higher in poorer performing labour markets – e.g. 28% in the North-East of England compared to 17% in the South West. 🧵 /3

Statisticians use three labour market categories: 1. In work (in employment), 2. Out of work and looking for a job (unemployed), and 3. Out of work and not looking (inactive). 🧵 /2

Today's stories saying the unemployment rate has risen from 4.6 to 4.7% tell only part of the story. The same data - the Labour Force Survey - shows this rise comes from more people who were inactive starting to look for work and so being classified as unemployed, which is good news 🧵 /1

UK inflation hits highest for almost a year and a half Food prices rose more quickly while fuel fell only slightly, boosting the overall rate of inflation.

Today inflation figures mean that food costs are up 36% over the last four years. It's people on the lowest incomes who will feel this hardest as food occupies much a higher proportion of their weekly budget. www.bbc.co.uk/news/article...

Peter Apps on X: "If anyone has watched the Netflix documentary on Grenfell and is looking for further reading, I've made all my posts on summarising the inquiry report free to read. Links in the thread below:" / X If anyone has watched the Netflix documentary on Grenfell and is looking for further reading, I've made all my posts on summarising the inquiry report free to read. Links in the thread below:

If anyone has watched the Netflix documentary on Grenfell and is looking for further reading, I've made all my posts summarising the inquiry report free to read.

Links in the thread below (on the bad site)

x.com/PeteApps/sta...

This is a really good and important report. Some thoughts of my own...

Graph comparing grocery price inflation trends with and without scanner data

👏 In rare, but welcome, good news from ONS, they are now using industry scanning data to measure grocery price inflation…
🛒 We should see much more accurate, reliable and granular grocery inflation numbers going forward, and about time too!
www.ons.gov.uk/economy/infl...

❤️‍🩹 | NEW REPORT: Voters want bold action on health – and don’t see it as 'nanny statism'. Our new research with Public First shows that smarter public health policy isn’t just good for the nation – it could be a vote-winner too.

www.ippr.org/articles/the...

Liverpool falls silent to remember the 97 football fans who were unlawfully killed in the Hillsborough disaster 36 years ago today

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Surely main benefit is actually being able to get on the train without forcing yourself on due to ridiculous level of overcrowding in Standard?

Drive-a-GMC-Yukon-round-a-Tuscan-hilltown challenge.

The penguins will greet us as liberators.

This is a really important point from Ashwin

Businesses can literally calculate the effects of the budget tax measures on their bottom line, but the big upsides of increased public investment are yet to come through, but businesses *will* feel those in time

Chart showing 5 line charts - showing the economic inactivity rate (as % of the relevant age-group) for 5 age-groups from age 18 up. Data from: https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/datasets/employmentunemploymentandeconomicinactivitybyagegroupseasonallyadjusteda05sa

According to the ONS' labour force survey, and government, 'spiralling inactivity' is one of the major problems facing the UK. But, even using the LFS, the rise is mostly young people being students. For other groups, after 2020, things are up and down. 1/2

Also there's a timing issue with budget effects. None of the measures have kicked in yet, but the costs of tax rises are easily identifiable to firms whilst the stimulus effects of public spending less so. This will naturally bias reactions downwards in the immediate term until the spending kicks in

Assessing the economy | IPPR The release of provisional November 2024 GDP figures shows a slight improvement on October, but still low. Yet over the past few days and weeks, there has

Finally, worries from businesses might well have a real effect in the short term but whether these persist will only emerge once we start to get GDP figures relating to 2025/26, from June onwards🧵
www.ippr.org/articles/ass...

Saying ‘we’re doomed’ right now is premature because we’re in that limbo period when none of the policy changes have actually taken place and where the negatives for each business are easier to predict than the positives🧵

So three takeaways: doomsayers are being overly pessimistic because they’re only considering the negative side of the budget equation and not the positive effects.🧵

Assessing the economy | IPPR The release of provisional November 2024 GDP figures shows a slight improvement on October, but still low. Yet over the past few days and weeks, there has

Also, lower inflation means a better chance of interest rate cuts, which would reduce business costs and increase confidence🧵 www.ippr.org/articles/ass...