Paper Summary: Wednesday 7th August

Recruitment, employment, HR

 

The FT looks in detail at ‘zero-hours’ contracts, and the underlying weakness of the labour market which is camouflaged by the strong overall employment rate. John McDermott argues zero-hours contracts highlight how the recovery is unable to provide people with secure jobs. He points to the high number of self-employed, part-time and zero hours workers in arguing why productivity is still so low, why skills are so low, and why a strong overall employment rate hasn’t translated into more dynamic economic growth. Critics call the scheme “exploitative”, others, like John Cridland of the CBI, argue “flexible working” puts more people in jobs who would otherwise be on the dole. The Institute of Directors said criticism of the contracts “misses the point entirely” – that point being a more flexible and modern labour market.

 

Property

 

“The property market has moved from rescue to recovery, and there is a good chance it is now entering full rehabilitation”, so says David Newnes of LSL on the front page of today’s Daily Express in a piece on property values rising 4.6% over the last three months (according to Halifax). The piece includes research by estate agency group Sequence showing house prices in July broke the 200,000 barrier for the first time since January 2010. “Wow”, was the verdict given by Rob Wood of Berenberg Bank. The Independent, The Times and City AM also covered the story.

 

In The Times, Kathryn Hopkins looks at the much-maligned Help to Buy scheme, and specifically at a warning from credit agency Fitch that the scheme will create a house price bubble and create significant liabilities for the taxpayer. It follows a similar warning from the IMF. Bad news for Mr. Osborne.

 

Economics

 

Factory production showed gathering pace in June with a 1.9% rise in manufacturing output and a 1.1% rise in the overall production measure, but a number of commentators have argued the positive month-on-month trend hides the fact that manufacturing output is still weak compared to its pre-financial crisis levels.

 

Personal Finance

 

More on the squeeze on household finances, this time from the Trades Union Congress (TUC) which said family savings rates were at a four-year low in the twelve months up to March. But it did concede the point that the economy is recovering, with consumer spending rising 4.2% over the same period.

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