Blog by author
The world is undergoing an unprecedented shock as a result of the Covid-19 pandemic and the widespread lockdowns. As major world economies are being put on hold, millions of jobs and incomes are being lost, which has created an imperative for economic policy actions to counteract the falls in demand and increased market uncertainty.
Dr Juan Fernández Radoselovics
In recent times we have received some good news about the Spanish economy. GDP has accelerated slightly in the first quarter of 2019, and the performance of the labour market has been promising. The unemployment rate has decreased considerably since reaching its peak in 2013 (26%), and Spain has just been released from the tight supervision of the European Commission’s Significant Deviation Procedure in which was immersed since 2009.
Dr Marta Paczos
Earlier this month NIESR hosted a workshop entitled “Global Value Chains: Current developments and Implications for Europe”. We brought together the experts from several leading European research institutes, international organisations and the private sector to discuss various aspects of global value chains (GVCs). All contributions dealt with questions of great policy relevance, for both the UK and the other European economies.
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.
UK productivity has been woefully poor since the onset of the Global Financial Crisis and has surprised forecasters to the downside. At the same time, employment has surprised to the upside and the employment rate has now reached record highs. In this blog we show that there is a long-established negative association between employment and productivity growth in the UK data, which signals a potential trade-off with far-reaching implications for public finances, Brexit and overall welfare.