UK real pay – plus ça change...

From the ONS table of “average weekly earnings at constant 2000 prices”, published today, we find the following March wage levels:

UK average total real pay
March 2006               £368
March 2011                £368
March 2016               £367

Yes, the real (after allowing for inflation) average wage per employee is almost exactly the same as it was 10 years ago… and 5 years ago…

When nominal meets real GDP

Today, ONS published its second estimate of GDP for the 4th Quarter of 2015. The annual rate of change (compared to Q4 2014) was 1.9% for both real and nominal GDP.  In Q3, the real and nominal rate of change was 2.1%.  Identical in both quarters.

We have to go back to 1959/60 to find a similar case.  True, in Q4 of 1999, there was a single moment when real and nominal came together – in that case at 3.7% - but that was ephemeral.

Q4 industrial production - small annual rise, but quarterly fall

The latest industrial production data, for Q4 and the month of December, were generally rather weak.

Taking the year 2015 as a whole, annual total production output rose 1.0% from 2014. Of the 4 main sectors, manufacturing output was the only one to fall, decreasing by 0.2%.  Mining & quarrying (including North Sea oil and gas) rose by 6.7% in volume terms, but of course with falling oil and gas prices, the change in revenue from this production will be far lower.

UK GDP Q4 – our economic deceleration continues

This morning, ONS published their first estimate for “real” (constant volume) GDP for the 4th Quarter (Q4) of 2015.  It shows an increase for the whole year of 2.2%, which is the same rate as in 2013, but well below the 2.9% of 2014. 

More significantly, Q4 saw an annual rate of change (compared with Q4 of 2014) of just 1.9%, the slowest annual quarterly rate of the year, or indeed since the first Quarter of 2013.  The annual rate of change in GDP by Quarter has in fact been decelerating for some time 

Collapse of real pay has outstripped the rise in UK jobs

If you add up the percentage falls in UK real pay for each year taking 2008 as the base for calculation, you reach an overall loss over the 7 years of 38.5% of the 2008 total wage.  Or roughly £10,000 in total.  

This is the essential backdrop to the employment data for November 2015, released by ONS earlier today. True, the headline UK employment and unemployment figures for the 3 months to November paint another positive picture.  The number of those aged 16 to 64 in employment rose by 213,000 over the previous (June-August) months.  But the gain in employment is a trade-off in terms of pay.  

UK construction output falls again in November 2015

Following lacklustre industrial production figures for November 2015 earlier in the week, the Office for National Statistics today published even less sparkling construction output data for November.  Output is estimated to have fallen both month-on-month, and year-on-year; it peaked in April 2015 and is now some 4% lower. 

Even the politically sensitive new housing annual output fell by 2.4% year-on-year for the last 3 month period.

US industrial production fell in December and Q4 2015

The US Federal Reserve today published its monthly statistical release on industrial production for December 2015, with some data for Q4 2015.  The overall position is that of a slight decline both month on month, and year on year.  On an annual basis (compared to December 2014) there was a fall in total industrial production of 1.8%.

November 2015 - UK industrial production slips

The Office of National Statistics (ONS) has today published the latest UK industrial production including manufacturing statistics – for November 2015 - and they do not make very pretty reading.

Total production output increased by just 0.9% in November 2015 compared with November 2014, while manufacturing saw a year-on-year decrease of 1.2%.  This marks 5 consecutive months of year-on-year falls in manufacturing production.

August: UK production up due to North Sea oil, manufacturing slides

Today, the Office for National Statistics published the latest estimated industrial production figures, for August 2015.  They show that total production output increased by 1.9% compared with August 2014. This is the best monthly percentage annual rise since April 2014.  However, on the downside, manufacturing output fell by 0.8% in August compared with August 2014, the fourth annual fall in the last 5 months.