Blog: April 2018
Football is a truly global sport. Behavioural economics can now be used to chart this phenomenon and its knock-on consequences. The vagaries of our team’s fortunes affect us much more than we think and can have many unfortunate consequences. It is well known that football outcomes can affect absenteeism at work, drunkenness, and civil disorder. Indeed research in the US has also linked NFL results to domestic violence.
There is a puzzle around the world as to why wage growth has been so weak given that the unemployment rate has returned to pre-recession levels. This lack of wage pressure has continued to generate consternation among policy makers, who continue to expect nominal annual wage growth to revert to pre-recession averages of 4% or higher and real wage growth nearer to 2%.
The past few months have been difficult for some of the UK’s largest low-paying sectors, with frequent news stories telling of squeezed profits and store closures among high street retailers and restaurant chains. In retail, the ‘bricks and mortar’ outlets are locked in a ‘survival-of-the-fittest’ battle with online competitors, whilst restaurants are suffering from a decline in spending on leisure activities due to inflation and stagnant wages. Last week’s rise in the National Minimum Wage and National Living Wage rates will only add to the challenges.
NIESR marked its 80th year with a special session at the recent annual Royal Economic Society Conference devoted to the “Productivity puzzles past and present.”
Four outstanding speakers - Nicholas Crafts from the University of Warwick, Eric Bartelsman from the Vrije Univesiteit Amsterdam, Phillip Wales, Head of Productivity at the ONS and Rebecca Riley, Director of ESCoE – took turns to examine the issue which has been bedevilling successive generations of economists .
Since the introduction of the Apprenticeship Levy a year ago, there has been a shift from Intermediate Apprenticeships to the Advanced and Higher Apprenticeships, which are vital for increasing productivity. Data from the Institute for Apprenticeships on approved and planned Apprenticeship Standards suggest that Higher Level Apprenticeships, in particular degree apprenticeships, will grow further.
If successful, the new Standards could help build a second, professional route of high-level education to deliver qualifications for associate professional roles, benefiting workplace productivity and social mobility. However, there are also risks, for example if the Levy-funded apprenticeships simply replaced existing under and post-graduate studies, which would have also been undertaken in the absence of the Levy, and did not result in a genuine increase in skills investment.
With many of the emerging Apprenticeships taking up to four years to achieve, we will begin to be able to estimate the full impact of the Levy in a couple of years.