Claims fall sends a growth cue

AT the start of each month there is huge excitement among economists and analysts on both sides of the Atlantic about the American non-farm payroll data.

There are learned discussions about what it means for Federal Reserve monetary policy, President Obama’s chances for re- election and the global economy.

The British equivalent of this data is the ‘claimant count’ of unemployment.

What is important about this series is that it is not based on surveys or any other notional count, but provides precise, realtime information as to the numbers signing on for the jobseeker’s allowance.

And against all the odds, given the great media fuss about doubledip recessions, it has been falling steadily since the start of the year and is now at its lowest point since July 2011.

Despite this, the tendency has been to ignore the hard data of the claimant count and to focus on other less-responsive measures of joblessness, such as the Labour Force Survey and to pick on the weak spots such as youth unemployment, part-time working and regional differences.

All of these are legitimate worries for policymakers, and need to be addressed.

But in purely economic terms, the claimant count ought to be regarded as a good forward indicator of the nation’s health, as it is in the United States.

Even the creation of part-time low-paid jobs is better than no jobs. It reduces government benefit bills, and it is far better to have people stacking shelves and getting back into the workforce rather than sitting in front of the flatscreen watching countless repeats of Come Dine With Me.

When the third-quarter GDP data is released next week it is likely to show that the economy had bounced back from the shock decline in the second quarter. There will be attempts to portray this as an Olympic boost and a post- Jubilee holiday recovery.

But, as in the US, we should see the fall in the claimant count as showing that the economy is not entirely flat on its back and that some of the steps taken to boost production, including funding for lending, might not be entirely useless.

In recent decades the UK has tended to see itself through the European prism, and there can be no doubt that the dispiriting uncertainty out of the eurozone has had a detrimental impact on output here.

But we should never forget that our next-biggest trading partner is North America, and that the City of London and Wall Street are umbilically linked through financial flows.

We should treat the claimant count, unemployment rate of 7.9pc and the drop in the jobless rate for 16-24 year olds as good news and a signal of better times ahead.

Bear hug

BP finally looks set to break free from its bonds with the four oligarchs in TNK-BP and forge a new broadly based alliance with publicly quoted Rosneft, in which the Kremlin has a chunky 75pc stake.

The first piece of the puzzle may have fallen into place when the oligarchs holding company AAR agreed to sell its 50pc holding in TNK-BP to Rosneft.

That opens the way for Bob Dudley, chief executive of BP, to finalise his own deal with Rosneft.

The outlines of the transaction suggest that BP will collect some $14bn or so for its stake and grab a 10pc plus shareholding in an enlarged Rosneft that will be the biggest oil exploration company in the world.

In effect, the BP board, if it agrees, will be swapping the oligarchs for the Kremlin.

Such an exchange is likely to produce some anxiety among shareholders, given the quixotic, kleptocapitalism represented by the Putin government.

Nevertheless, BP is used to living with undesirable regimes across the globe, and Rosneft, because it is freely quoted, does have a legitimacy beyond the Kremlin – as well as rights to valuable oil exploration assets in the Arctic and beyond.

A Russian deal will end one episode of uncertainty for Britain’s energy champion.

But it will now have to wait until after the US election for some finality in the country where a criminal prosecution over the Deepwater Horizon spill still awaits.

Revving up

OH HOW useful it would be if we had a genuine British Investment Bank.

If such an institution existed it would be the ideal financing partner for Cosworth, one of Britain’s leading edge engineering brands and part of the Formula 1 technology hub.

The current US owners have been looking for funds to take Cosworth to the next level, but it is proving a hard slog.

Hopes that Rolls-Royce might be interested have been dashed.

It would be a pity if the R&D, patents and other skills were to vanish overseas.