A-Level

UK Inflation Rate and Graphs

UK Inflation Rate and Graphs

Current UK Inflation RateCPI inflation rate:  3.0% (headline rate) CPI – D7G7 at ONS (page updated 17 October 2017)Source: Raw data General inflation tables | CPI annual % change D7G7 at ONSOther measures of inflation(CPIH) CPI including owner occupiers’ housing costs – 2.8% (CPIH – L550) Factory gate prices (Output prices) 3.3% June 2017 (output prices) ONS See: Measures of inflationCost-push inflationary factors In 2017, UK has seen a rise in cost-push…

UK unemployment-rate

UK Unemployment Stats and Graphs

A selection of graphs and statistics on UK unemployment. Also, looking at factors that explain UK unemployment and why unemployment has fallen in recent years.Raw data:  Labour market data | Source: ONS MGSX (LFS) Current UK Unemployment rateUnemployment rate of 4.3%, (Oct 2017) –  (UK Unemployment at ONS) 1.45 million unemployed people. (ONS)Employment ratesEmployment rate: 75.3% (proportion of people aged 16-64 in work) – ONS Employment:  32.136 million people in work.Participation…

Economic Growth UK

Economic Growth UK

Economic growth measures the change in real GDP (national income adjusted for inflation; ONS call it chained volume measure of GDP) In 2016 the UK economy grew by 1.8% –  (compared to 2.2% in 2015. In the first half of 2017, the economy has grown by just 0.5% (annualised growth of 1%) Q1 0.2% | Q2 0.3% The peak to trough fall of the economic downturn in 2008/2009 is now estimated to be 6.0% Figures for Q2 2017 show the economy is reliant on consumer spending, with…

Importance of exports to the economy

Importance of exports to the economy

Exports play an important role in the UK economy, influencing the level of economic growth, employment and the balance of payments. In the post-war period, lower transport costs, globalisation, economies of scale and reduced tariff barriers have all helped exports become a bigger share of national income. In 2011, exports of goods and services accounted for 19% of GDP (up from 14% in 1990). Imports accounted for 24% of GDP – indicating that we have a current account deficit.Importance of exportsEmployment. Growth in exports…

UK Government spending – real and as % of GDP

UK Government spending – real and as % of GDP

In 2015/16 the UK government is forecast to spend a total of £753 billion.Source: HMT public spending statistics (May 2017) Also see: HM Treasury PESA (released 21 July annually Real term trends in public spendingSource: HMT public spending statistics (May 2017)    UK Pension spendingMore details on pension spending. Government spending as % of GDP

The effect of a current account surplus

The effect of a current account surplus

Readers Question: how does a current account surplus affect domestic employment? A current account surplus means an economy is exporting a greater value of goods and services than it is importing. A country with a current account surplus will have a deficit on the financial/capital account. i.e. a country with a current account surplus will have surplus foreign exchange it can use to invest in other countries. There is no hard and fast rule about what will happen if a country has a current account surplus. It depends on the…

Keynesian economics

Keynesian economics

The essential element of Keynesian economics is the idea the macro economy can be in disequilibrium (recession) for a considerable time. Keynesian economics advocates government intervention to help overcome the lack of aggregate demand to reduce unemployment and increase growth. Theory behind Keynesian economics 1. If saving exceeds investment, we get a recession Classical theory suggested any fall in investment would lead to lower interest rates; this fall in interest rates would reduce saving, increase…

Difference between microeconomics and macroeconomics

Difference between microeconomics and macroeconomics

Readers Question: Could you differentiate between micro economics and macro economics?Microeconomics is the study of particular markets, and segments of the economy. It looks at issues such as consumer behaviour, individual labour markets, and the theory of firms. Macro economics is the study of the whole economy. It looks at ‘aggregate’ variables, such as aggregate demand, national output and inflation.Micro economics is concerned with:Supply and demand in individual markets Individual consumer behaviour. e.g. Consumer choice theory Individual labour markets – e.g. demand for labour, wage…