So many forecasts of doom ... yet the UK still prospers
AMID all the pessimism generated by the emergence of Omicron and the ongoing political shenanigans at Westminster, there is one set of positive statistics that the doomsters cannot ignore: the employment figures.
Britain’s jobs miracle is alive and well and the underlying dynamism and creativity of the UK economy continue to shine through the gloom.
At the start of the pandemic in March 2020, the prediction was that Britain’s jobless total could surge to 12 per cent of the workforce. This has turned out to be wildly inaccurate.
The latest official data shows unemployment actually fell from 4.3 per cent to 4.2 per cent in October, with some 257,000 citizens joining the nation’s payrolls.
Anyone tempted to say this is a temporary phenomenon that will be wiped out by the worrying surge in Omicron infections should think again. The Office for National Statistics reports that the British economy has no fewer than 1.2million unfilled vacancies.
These figures make a mockery of Labour claims that there would be a jump in unemployment when Rishi Sunak’s furlough scheme ended.
The monthly data shows there was a small blip in early October, as the job-supporting programme ended, but well before the month was out the employment-creating behemoth that is the modern British economy was on terrific form.
W ALK down any high street or visit any shopping centre in the land and you will spot desperate-sounding job vacancy advertisements posted in shop windows, pleading for staff. It’s the same story in the hospitality and social care sectors.
For despite all the dire predictions of a Brexit and Covid-fuelled jobs disaster, Britain’s economy is outperforming those of its former partners in the European Union.
Forecasts just issued by the International Monetary Fund (admittedly prepared before Omicron became a factor) show the UK economy to be in rude health.
How then has Britain been able to defy the forecasters and create so many new jobs?
This boom can be attributed, at least in part, to the success of coordinated action by the Government and the Bank of England.
Instead of allowing Britain to slump, as was the case during the Great Depression of the 1930s and after the financial crisis of 2008/9, the Chancellor stepped in with unprecedented fiscal help in the shape of the furlough scheme and the introduction of measures such as bounceback loans, which prevented smaller business from going to the wall.
Britain’s flexible labour markets, largely a result of the Thatcherite revolution, allow firms to hire without the fear that, if economic conditions change, they will be lumbered with labour costs they can do nothing about.
This is in sharp contrast to their competitors in the EU, where – with one or two exceptions such as Germany – over-regulation has led to a sclerotic labour force and high unemployment.
In the UK we have also been assisted by having a more nimble post-industrial economy.
Britain is also a global star in the life sciences (as has been illustrated by our leading role in developing Covid vaccines) and new technologies such as artificial intelligence.
This week it was revealed that in 2021, UK film and TV production for streaming channels such as Netflix, Amazon et al was sharply up at £5.5billion, almost double where it was at the time of the Brexit vote.
In spite of doom-laden predictions of a jobs exodus to Europe from the City-dominated financial and professional services sectors, they now employ more people than ever.
We can all be comforted by the fact that, whatever hardships are thrown up by the mutating Covid virus and challenging global economic circumstances, Britain is in a strong position to prosper.