The other British economy: low productivity and no manufacturing strategy

There was plenty of data out this week suggesting a bleaker economic picture than that painted by the government and the media.

This week’s figures on manufacturing growth from the Office for National Statistics (ONS) proved to be weaker than expected and they demonstrate the need of a robust manufacturing strategy and leadership from the government – neither of which is happening.

The ONS published figures on Friday showed that manufacturing output rose by 0.3 per cent in December last year – less than the 0.6 per cent predicted.

On top of that news comes a warning that lagging productivity poses a risk for the UK’s medium term outlook and recovery.

The National Institute of Economic and Social Research (NIESR) has warned that low productivity would continue to pose a challenge for the economic outlook as it limits wage growth.

“Our forecast remains one of a gradual improvement in productivity, but continued stagnation poses a downside risk to the UK’s medium-term prospects,” NIESR said.

The NIESR also pointed out that growth was being fuelled by the housing market – and it expects this will continue for the next two years.

This is hardly a basis for re-balancing the economy as current growth and rising employment (through agency and temporary work) has not brought about an upturn in productivity.

The fact is that the figures paint a more realistic picture of what is happening in the economy than that being spun by the government and the media.

8 Responses to “The other British economy: low productivity and no manufacturing strategy”

  1. John

    It’s why I put ‘extreme’ in quote marks. Compared to even early Labour UKIP actually isn’t an extreme party at all, however it’s perception is far-right so thats the image it’s stuck with for now.

    I would look at your link, and scrutinise your findings except apparently the “page is not found”. I was basings my conclusion on this piece of work

    Since I can see no percentage in the BBC branding itself a slightly left-leaning organisation (and since everyone compalins their biased) I’m inclined to believe the conclustion.

    I don’t believe I argued that Capitalists are moral. I was pointing out that the minute a large corporation uses business pressure to alter a political outcome in their favour the market ceases to be completely free. Absoluate capitalism is as impossible as absolute socialism (as Russia rather conculsively proved). Since we can only have gradiation of capitlaism and must legislate to limit the amount of influence corporations can have over politics we may as well have a structured economy so everyone knows who can do what and for how much.

    It would appear, on your next paragraph, that you agree with me and we are merely arguing philosophy and semantics.

    Singapore is a good example of a free market and is doing exceedingly well, I agree; my point was that under Thatcher we moved closer than at any other point I know of in British political history, and it caused huge amounts of unrest and generations of damage to our economy and society. How much of this is directly attributable to the free market model is arguable, but trying to argue that NO damage was caused by the free market model is practically indefensible.

    Whether the British economy is systemically opposed to free markets, or we’re societally opposed is irrelevant.

    The final point I wished to make about free markets is that even America doesn’t embrace them; when a ‘too-big-to-fail’ bank threatened to fail the government bailed them out. This is in direct opposition to free markets. Free markets would’ve seen those bank crash and burn, bringing the world economy (including Singapore) down with it. Free markets may self-regulate, it’s true, but I evidence shows the regulate in favour of the entities which exist within their system; the corporations. NOT the people who support it; the workets.

    I suspect, therefore, that a global free market is as implausible as global socialism, though it would be fun to try them both. In many ways capitalsm and socialism coexist in better harmony than capitalism and democracy.

  2. neilcraig

    Thanks, that was an interesting if complacent report
    “UKIP coverage has dropped from 2.7% to 1.4% which is surprising”
    “UKIP got only 2 items on the EU …..which is ample”
    Indeed particularly when they later say that the methodology greatly understates LabCon coverage because it counts a long LabCon interview as equal to a 3 second soundbite from Farage.
    Also throughout almost all mentions are the LabConDems, even claiming the Dems as the “3rd party” which in terms of viewer/voter support they certainly aren’t
    If freedom of speech is a necessity for democracy, Britain isn’t one.
    I would agree that absolute capitalism is impossible, as, history demonstrates, is socialism. That doesn’t greatly impinge on whether we can, or should, get quite a lot closer.
    Incidentally the ruling party of Singapore, which I agree is an outstanding example of success, started as officially socialist and, though economically capitalist, does provide a welfare safety net better than ours. It is marginally poorer than Hong Kong which is as free market as you get but the difference is not sufficient to class as major.
    Incidentally I forgot to explain the 6% world growth figure last time:
    (20/100 x 0%)[EU growth} + (80/100 X 6%)[rest of the world] = 4.8% {the IMF estimate I mentioned].

  3. John

    Oh we’ve not had freedom of speech in this country for years. Nor do we have a law garunteeing it. What we DO have, is laws against people speaking out in ways which can disturb the peace. 1984 is not so very hard to reach even with our current laws, but thats a seperate debate.

    Certainly we don’t have free speech, nor a free press. Which is why, if you want the truth of a matter you need to source from a variety of papers or, better yet, find the raw data from which their stories were drawn.

    I agree. The question thus posed, then, is where the line should be drawn. I have no answer to that, as I have not firmed my opinion on this matter. My politices are a mix of libertarian and free market theories so I tend to judge on a case-by-case basis. Not conducive for sweeping statements that.

    I know this well, and I see both it and China as vindication of my view that capitalism does not require democracy, nor does it exactly flourish within it.

    Thankyou for those links; they both work and shall provide me with reading material I shall scrutinise. Thank you also for expanding my knowledge. It is always a pleasure.

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