Wednesday, 23 November 2011

Self defeating

Today we saw more evidence of the economic woes, with real income falling by 3.5% in 2011, with wages not increasing as fast as inflation.

The headline figures also masked sizeable falls in pay for some of the UK's lowest-earning professions – and sizeable salary boosts for senior managers and directors.

Workers in "elementary occupations", a classification including labourers, farm workers, postal workers and others, saw their typical pay fall 0.9% against its 2010 level, while professional pay rose 1% and managerial salaries rose 0.5%.

Directors and chief executives of leading organisations enjoyed the most sizeable pay rises, with median earnings up 15% to £112,157, in part a result of trends shifting earnings to basic pay and away from bonuses.

Salaries of senior corporate managers also increased substantially – up 7.1% year-on-year to £77,679.

Today's figures confirm that 2011 has been a year of wage stagnation, with pay rises far outstripped by inflation, and low-paid employees being squeezed particularly hard.

Falling wages and self-defeating austerity have been the main reasons for the UK's economic woes, rather than a eurozone crisis which has yet to fully show up in official statistics.

The coalition government also announced today that they wish to further undermine workers rights with giving employers more power to sack workers for under-performance and less time to enjoy full employment rights.

These changes further strengthen the hands of employers.

Yet the real needs of business are being neglected, access to reasonably priced investment funds that are accessible for investing in their businesses for innovation and expansion, the need to look at tax for employing new staff and boosting manufacturing and technologies.

Tuesday, 8 November 2011

More evidence of insecurity

The resolution foundation has conducted a opinion poll with MORI, the poll confirms fewer people feel secure in their employment, part time workers feel even less secure than full time workers.

32% of people have cut back on their spending this year and a further 20% of people expect to continue cutting their spending next.

With dismal unemployment figures and latest official statistics also showing dramatic falls in consumer spending and the proportion of overall household income that is saved rising again, the signs are that households are preparing themselves
for the worst as they batten down the hatches financially.

An Office for National Statistics (ONS) report that VAT takes more from the poor than the rich has merely contributed to the growing impression that we are not all in this together.

Much of the current weakness in the economy is due to a generalised loss of confidence in the ability of policymakers to put in place appropriate responses. It is therefore imperative to act decisively to restore confidence and to implement appropriate policies to restore longer-term fiscal sustainability at a pace that depends on the size of the fiscal challenge as well as the state of the economy and to strengthen long-term growth, this translate to Plan A isn't working.