Going for Growth report from OECD

Going for Growth 2013: OECD

  • In Europe, where unemployment is still above pre-crisis levels, many countries (including Denmark, France, Italy, Portugal, Slovenia, Spain and Sweden) still need to lower barriers to job creation, hiring and mobility, while improving incentives to take up work.
  • In Japan and Korea, raising the labour force participation of women is key, and will require better benefits systems and improved childcare policies.
  • In lower-income OECD countries (like Chile, Mexico and Turkey) and the BRICS, reducing informality is a common challenge, so governments must improve incentives to create and take jobs in the formal sector.
  • In the United States, unemployment has receded somewhat from its post-recession peak but the number of long-term unemployed and discouraged job seekers remain high, calling for programmes that provide training and employment services to be beefed up and streamlined.

Retail Sales

Hard times for small retailers

Retail Sales, January 2013: ONS

  • In January 2013, year-on-year seasonally adjusted estimates of the quantity bought in the retail sector fell by 0.6%, putting a halt to the year-on-year growth seen in the retail sector since August 2011.
  • Year-on-year estimates (non-seasonally adjusted) showed an overall fall in the quantity bought in small stores, in particular those with 0-9 employees, while large stores saw an increase. This was particularly marked in the food sector with feedback from small retailers suggesting that the heavy snow fall in the latter half of January affected sales. In contrast, feedback from large store retailers suggested that some of the increase in the quantity bought came from a rise in online shopping.
  • The quantity bought in the food sector was estimated to have fallen 2.6% year-on-year (seasonally adjusted), to the lowest level since April 2004, providing the most downward pressure to the fall in the total quantity bought in the retail sector.
  • In the food sector, the proportion of sales made online rose by 27.1% (non-seasonally adjusted) compared with January 2012, which equates to 3.7% of all food sector sales, the highest on record.
  • This January, the overall proportion of non-seasonally adjusted online sales remained above the 10% mark, normally seen during the lead up to Christmas, which was 8.7% higher compared with January 2012.
  • Looking at the monthly picture, (January 2013 compared with December 2012) both the seasonally adjusted quantity bought and the amount spent in the retail sector were estimated to have fallen by 0.6% and 0.4% respectively.
  • The amount spent in the retail sector was unchanged in January 2013 compared with January 2012. Sales at petrol stations provided the main source of downward pressure to the amount spent in the retail sector. When sales at these stores are excluded the amount spent increased by 1.2%.

European GDP: Eurostat

  • GDP fell by 0.6% in the euro area (EA17) and by 0.5% in the EU27 during the fourth quarter of 2012, compared with the previous quarter.
  • In the third quarter of 2012, growth rates were -0.1% and +0.1% respectively.
  • Compared with the same quarter of the previous year, seasonally adjusted GDP fell by 0.9% in the euro area and by 0.6% in the EU27 in the fourth quarter of 2012, after -0.6% and -0.4% respectively in the previous quarter
  • Over the whole year 2012 GDP fell by 0.5% in the euro area and by 0.3% in the EU27.

Changes in real earnings in the UK and London

Changes in real earnings in the UK and London, 2002 to 2012: ONS

  • After three decades of strong growth, real wages peaked in 2009. Since then inflation has outstripped wage increases in cash terms.
  • In real terms, the average earnings of UK employees in 2012 were at 2003 levels.
  • Employees working in London earn more on average than UK employees and their average real earnings fell less rapidly from 2010 to 2012


BoE Inflation Report

Quarterly Inflation Report: Bank of England

  • The MPC continues to judge that the UK economy is set for a slow but sustained recovery in both demand and effective supply
  • CPI inflation is likely to rise further in the near term and may remain above the 2% target for the next two years.
  • Inflation is expected to fall back to around the target thereafter, as a gradual revival in productivity growth dampens increases in domestic costs and external price pressures fade.
  • Growth is likely to remain weak in the near term