Econ Editor, BBC News. Newsnight presenter. Host award-winning EUref TV interviews & 2017 GE debate. United ST. occasional Eurovision vocalist 😆
London(head) Manchester(heart)
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Hello all - I’m back on here, back in economics and after a few weeks wilfully getting lost in transit, am newly on here👇🏾, and shortly on air in a new role as Economics Editor of the BBC..
first take on data, trade wars, Brexit, fiscal gymnastics...👋 bbc.co.uk/news/business-4890…
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Unemployment rate down to 4.7%, and employment rate up in latest figures. Now down 0.5% from 5.2% peak last year.
Measurement issues in the headline jobs figures, but the quality is increasing so these numbers may reflect situation better than last year’s numbers.
Vacancies fell again though, lowest outside covid since 2014, but also in line with average. By sector the levels story is as would be expected - concentrated in social care/ retail and hospitality BUT they were all flat in latest quarter, retail actually added 3k vacancies.
General picture of a low hire low fire low churn flat labour market, with some interesting under the hood stories.
Peak in long term sickness driving fall in inactivity? Down 80k from 2.82m in Jun-Aug 2025 to 2.74m. The small has occurred amongst male workers. Female inactivity is flat. Overall still up 600k plus since pandemic.
Age hit - Over 65s fastest age group adding to payrolls - up 5.6% in year to September. 25-34 yo down 1.9%.
AI tech jobs challenge? Not coming through in the payroll numbers cut by age, eg for 18-24 year olds, but sectorally info & comms payroll numbers have fallen by the most of any major sector - down 2.5% over past year, bigger proportional hit than eg hospitality.
Clear public-private split on growing payrolls and earnings growth.
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Did some digging on UK GDP numbers on plane.
Digging into the ONS three decade monthly GDP spreadsheet: annualised growth of 2.7% from Jan-August is the strongest start (first two-thirds) to a year since 2017 (excluding the pandemic bounce back)
And Q3 is heading for about 0.7%, even if September is flat... Revisions are possible but they have been up in recent months.
By some way strongest start to a year since COVID.
Can see why it’s termed strong by multiple city economists. Especially given the Iran War headwinds. Perhaps they are just delayed by energy price cap and slow pass through of higher mortgage rates, but the idea the UK would be “hardest hit” has turned out to be nonsense so far.
More widely it is a return to the sort of normal growth pre Brexit/ financial crisis.
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Just to be clear - doesn’t mean we are heading for 2.7% actual 2026 y on y GDP growth, that is done on a different basis - that is plausibly heading north of 1.5% which is well north of expectations earlier in the year… and q4 would reasonably expect to slow. Perhaps the key way to put it is the expected q3 slowdown (seen in recent years and because of Iran) has not materialised and there is an AI capital investment story here too.
It would be silly to get carried away, but perhaps many people, did get carried away in the other direction…
interesting to see what the OBR does on growth given all this, and the productivity upward revisions too.
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Will take a look at the German numbers too…
Germany is also having its best run since 2017. Hopefully European output will move closer to its strong employment growth since 2013. EU and US employment growth over the 2013-2026 period has been identical at 13%. Not enough people know that.
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Quite the story from the Telegraph - the interesting side implication here of sensitivity about consumer reaction in Europe
EXCLUSIVE: Elon Musk came to Donald Trump with the plan to throttle Ukraine’s use of SpaceX’s Starshield satellite internet network, sources have told the Telegraph.
The tech billionaire made the proposal during the US President’s row with Volodymyr Zelensky over strikes on Russian oil refineries.
‘The reality is that they were both in it,’ a senior source said of Musk’s and Trump’s involvement.
But after a night of carnage in Kyiv caused by the slowdown, Musk was alarmed about the possibility of adverse consumer reaction in Europe.
The SpaceX boss then proceeded to tweet, blaming the US administration, and ultimately, President Trump for authorising the slowdown.
‘He tweeted out that he was innocent and that it was the US administration that did it,’ the source said.
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Our reporting on same…
US senators call for investigation into Ukraine's Starlink restrictions bbc.in/4zwJGe9
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Yes, I air-drew a bar chart of annual borrowing levels with the Chancellor at the IMF… think he’d already memorised the numbers….
I wrote about what we learnt from a week talking to too many finance ministers about the world economy on the website this morning… including China shocks, emerging economies raising their eyebrows at G7 debt levels, AI saving the economy and threatening humanity… and some intrigue about UK-EU “the dating divorcees”.
bbc.co.uk/news/articles/cm4g…
Despite military grade security protocols (yes this is true) on the Budget, think we can begin to build a picture of what we do know about the statement and the 10 year plan that follows… but will write that up separately. Healeys views on Heathrow expansion being pro growth are this mornings instalment.
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The airspace channel through the crises on the way back from the IMF meeting in Bangkok…
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UK GDP in August now up 0.7% on the 3 month measure… rises by 0.1% in the single month, defying expectation of a fallback after strong July.
June also revised up.
Heading for a decent Q3.
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Before the figures were released the Chancellor here in Bangkok at the IMF said he was “pleased the IMF here in Bangkok backed our economic plans in London.”
“They say the UK stands out on growth despite the deep economic shocks that are affecting worldwide at present.”
“They say Britain stands out in our plans to get to grips with the big borrowing costs by previous governments.”
“They also say it’s important to stay the path. And I will follow that as I prepare my budget in two weeks’ time.”
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“The UK is actually one country where action to reduce debt and deficit has been taken decisively and we see the UK in that sense enjoying a bit of a better growth prospect”.
IMF MD Kristalina Georgieva just again singled out UK for its plans to reduce annual borrowing, amid more general warnings that advanced economies should “get house in order”, after the forecast figures released yesterday.
Also said growth is not enough for US to reduce rising borrowing…
Pretty striking…. UK now basically only significant G7 consolidation (3.9%), 2 on basically 0, 3 show actually increasing headline borrowing between 2025 and 2031, based on IMF projections.
This is headline borrowing - should get new figures on primary deficit etc overnight too
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NEW | The chair of English football's independent regulator says he will resign if he encounters any political interference over the future of Manchester City. ⬇️ #mcfc
bbc.co.uk/sport/football/art…
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NEW:
From Bangkok, IMF World Economic Outlook released…
- Upgrades UK growth this year by 0.3% to 1.3%, joint second highest in G7, defying the idea the UK would be hardest hit by Iran war… but inflation higher and growth trimmed next year
- UK “stands out” on deficit reduction, IMF Chief economist tells me, as its figures show a 3.9% point fall in deficit from 2025-2031, significantly more than other G7 nations, with 3 of them actually increasing their deficits over this time.
- IMF says UK should “stay course” on fiscal plans, Chancellor arrives tomorrow
- overall story of resilience in world economy, despite the clouds from the Gulf, as AI boosts US, Asia and UK to some degree… energy and trade proving flexible in dealing with shocks
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NEW & EXCL
French finance minister @RolandLescure on Brexit, bond markets and school protests:
Tells me:
- he came into politics after his sadness at Brexit, and of the options suggested by Andy Burnham “Come back all the way”.
- - The Govt will listen to French students, the old need to share burden of budget consolidation and it’s a “tough world”
- borrowing levels “alarming” and said “thats why we have to act now” to avoid being forced to act later. Asked about the possibility of an intervention from the Eurozone’s central bank, said his job was to make sure France did not have to “go there”.
- He said that his Budget “will pass” a fractious French Parliament and there are “lots of different ways” to ensure that.
- criticises Le Pen “wrong recipes and wrong numbers” and Melenchon “exaggerate, insult, scream and cry” after threats to prosecute the French central bank Governor Moulin for treason
- election was ‘far from played” and polls pointing to a hard left-right runoff ”in no way” showed what would happen in the spring.
More across BBC News
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Opposition leader Kemi Badenoch announces new policy that a Conservative Govt would “legislate so nobody will ever pay inheritance tax on their family home”… and couples would be able to leave an extra £1m “tax free”…
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So presumably that means that it will not be payable from the deceased persons estate. There is already a £1m effective allowance, so this extends this up to any value, plus £1m. Will be interesting to establish how this might interact with the plans from next April to bring unused pension pots into the IHT remit.
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British Chambers of Commerce also welcomed the plan to cut young workers NICs payments, though want it abolished.
Said they were “disappointed” to hear BAdenoch “dismiss serious discussion” about UK trading relationship with EU. Exporting firms are “crying out” for steps to make trading with EU “cheaper and easier” it said.
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