The figures on the UK economy are becoming ever more incredible. Unemployment fell by another 46,000 yesterday, for the fourth successive month. A million private sector jobs have been created since 2010 (double the number of government job cuts). And yet economic growth has been plunging for nine moths now – by 0.7% in the most recent quarter alone.
There appear to be only two possible explanations. Either productivity is collapsing (i.e. all those workers are producing less per hour), which seems odd give the shift from public to private sector.
Or the numbers are dodgy and we’re not really in recession at all.
I feel a bit sorry for Osborne, and indeed for Darling. Labour lost the election partly on the back of ONS figures that had the country in recession in 2009 – which has recently been revised to show that the economy was in fact growing back then. Bit late, really.
Here’s my article in today’s Scotsman on this subject.