Growth maybe, but not for earnings
A blizzard of none too cheery figures around today. The ONS published analysis suggesting that average hourly wages are very slightly down on 10 years ago.
The Resolution Foundation analysis of low and middle income families suggested that on average by 2017 they would be slightly worse off than they were in 1997.
Ed Miliband added a different number to the mix but in a similar spirit: he challenged David Cameron in the Commons to admit that (based on OBR price and earnings projections) average households would be worse off by the time of the 2015 election than they were in 2010 when he came to power. David Cameron, not surprisingly perhaps, didn’t feel he could confidently counter that.
At his penultimate press conference as Bank of England Governor, Mervyn King talked of “optimism” while giving few grounds for it. He said growth of a pale kind would come but the government should consider some extra supply side measures to deliver it. He name-checked the LSE growth report and the Heseltine plan as amongst possible routes. No doubt back at No. 11 they’ll be thanking him profusely for that.
The implication was that he’d pulled just about every lever that was prudent to use and he was already being flexible about the inflation target (eat your heart out, Mark Carney)… there isn’t a magic cure and it’s over to you, George. Mervyn King has one more of these to go in May. Is he flicking his tail on his way to the exit?
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