Paper Summary – 7th November 2012

Economics

Breaking news this morning that Barack Obama has won the American election: he overcame a sluggish economy, high unemployment and a strong challenge from Mitt Romney to win a second term in the White House, a victory based on a near-sweep of battleground states across the country. David Cameron was thrilled at the news as he congratulated “my friend Barack Obama” as he won and pledged to work with the US leader to “kick start the world economy”. (Telegraph)

Just a couple of weeks after the UK economy climbed out of a recession at a faster rate than anyone expected, and the prime minister declared ‘the good news’ will keep on coming’ sadly the good news has come to a halt. Attention is turning to worsening business conditions as surveys emerge showing output in the production industries crashed yesterday, data showed, due to a collapse in mining and quarrying which analysts suggested might end up in downward GDP revisions. While manufacturing output rose 0.1% into October, according to the ONS, overall production dropped by 1.7% by a 15.3% fall in resource extraction output. As a result production was 2.6% lower than a year ago and analysts believed this fall could bring a 0.1% point revision in the Q3 GDP. Positive forecasts came out yesterday from the National Institute of Economic and Social Research indicating the economy may continue recovering in October with GDP rising 0.5% over the month. ( Financial Times, City AM)

 Property

The downward correction to house prices gathered pace according to data out yesterday. House prices in Britain fell at a faster rate in October as the overall economy stayed weak, lender Halifax discovered. House prices were 0.7 percent lower than in September, Halifax said, confounding economists’ expectations for a small rise. While one estate agent today, namely Knight Frank interpreted prices suggested they would not reach their pre-recession peak until 2019, sating average prices falling 2 % across 2012 and still sliding through 2013. In addition Knight Frank said today even prime central London, seemingly proving resilient despite recession, will register no growth during 2013, due to tax changes. They pointed out that in March Mr Osborne raised the stamp duty charge for homes over £2m to 7% (up 5%) noting sales up to £2m have already fallen a quarter.  (city am)

Personal Finance

Figures reveal today that 81p of the cost of every litre of petrol goes to fill the Government’s coffers. For every 138.3p motorists typically pay per litre, almost 59% goes to the Treasury in fuel duty and VAT according to recent data from HoC library. The Government is set to increase the duty on petrol and diesel by 3p a litre on January 1st despite opposition from motoring groups and campaigners urging George Osborne to scrap the rise. (Daily Mail)

Recruitment

Adecco the world’s biggest staffing group said it expects no improvement in Europe’s job markets until late next year because businesses are reluctant to hire due to uncertainty about the Eurozone debt crisis. Unemployment in the euro zone rose to a record high in September, while a survey of manufacturing activity for the region – which acts as an indicator for economic growth – shrank for the 15th month in a row. The fact that revenues are not dropping off like they were in 2009, means that there are a lot of companies that are really stretched to the limit. (City AM, Reuters)

Female executives earn half a million less over a lifetime than men, as evidence reveals today. there are more senior women, but that the pay gap is going into reverse. Figures from the Chartered Management Institute show a woman and a man starting executive roles at age 25 and working in an identical route up the career ladder until retiring aged 60 and found the average female executive in the UK earns £400,000 less than her male counterpart over a lifetime of work and women in executive roles are much more likely to win bonuses worth less than half those given to male colleagues. Apparently fewer women are in management roles, despite this the CMI’s research suggests this could change with the percentage of women in the executive workforce standing at 57% which is the highest levels since records began in 1995. 

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