Economists, eh? Sometimes it seems as if they’re the sort of people who would fret about sunburn and insect bites on a balmy summer’s day. How else to describe the reaction of some of them to the latest employment data from the Office for National Statistics? The UK, we’re told, has the lowest level of unemployment since 2008. The rate of wage growth is easing back, so the Bank of England’s dovish view on interest rates will have been confirmed.
That should keep the lid on the pound, and help manufacturers with their exports, and goodness knows the UK’s trade balance could do with them picking up the pace.
So what’s not to like? Well, it looks as if I’m set to join certain economists in playing party pooper. However, I’m not looking for negatives in the numbers. What concerns me is what’s going on behind them, namely the type of jobs being created.
The Bank has indicated that it expects to see the UK starting to create better jobs, which pay more. That should lead to a pick up in wage growth, but there wasn’t any sign of that on Wednesday. Sadly, if you want a picture of what the recovery in employment has looked like so far, I give you Sports Direct, with its zero hours contracts and staff who are afraid to call in sick when they’re ill. Now, where did I put that insect repellent and suntan cream…
