Daily Newspaper Summary: Friday 27th December 2013

Economics

Fears of a festive slump across the retail sector were dispelled on Boxing Day as sales delivered a Christmas boost to Britain’s retailers. More than £2.7 billion was spent in stores and at online retailers across the UK with many shops reporting their busiest Boxing Day to date. Around 1.4 million shoppers were expected to have spent a total of more than £50 million in London’s West End yesterday. The Daily Telegraph, front page and everywhere else.

Personal Finance

The current strength of the pound is making exotic holiday destinations such as Bali and South Africa ore affordable as Brits find that their money goes further. The stronger sterling is giving Britons up to 28 per cent more spending money abroad this month, compared to this time last year. The Times, pg 21; The Daily Mail, pg 49

Fifty per cent of pensioners want higher interest rates to counteract the disastrous effects of years of low returns on their savings. Fifty per cent of the over sixties say a rise in interest rates would make them better off, according to a survey. By contrast, just seven per cent say they would be worse off. The Daily Mail, pg 18.

Property

There is currently a boom in sales of £1 million + houses  which have risen by ten per cent above the previous peak they of 2007, with 9,700 transactions at that level, according to Hamptons International’s analysis of Land Registry data. London accounted for around 70 per cent of £1 million + house sales this year and according the research new hotspots have emerged over the last six years with Battersea and St John’s Wood both moving into the £1 million + top ten. The Times, pg 11; The Daily Mail, pg 37

Britain’s high end housing market risks falling into a “zombie zone” as political rhetoric against foreign investors builds in the run up to the general election. George Osborne utilised his autumn statement to kick off the Tory party’s re-election aspirations with a crackdown on wealthy foreign homeowners who will be liable to pay capital gains tax in future. Ed Mead, Director at Douglas & Gordon, said the market was likely to fall into a zombie state, with a slowdown of growth at the top end of the market generated by uncertainty. The FT, pg 2.

Recruitment / HR

According to an exclusive in The Mirror staff in just three governmental departments pocketed more than £15 million in bonuses last year. £6.5 million of tax payer money was dished out to Home Office workers alone, 44.9% higher than the previous year. The Mirror, pg 6.

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UK Paper Summary: 27th November 2013

Personal Finance

Brits are withdrawing more cash from their properties to pay for Christmas, according to The Sun. New research from LMS shows borrowing against an existing mortgage is 30 per cent higher than a year ago, as total remortgage lending rose to £4.73 billion in October. That was equal to the average homeowner releasing £21,579 in extra equity. Andy Knee, chief executive of LMS said: “About 18 per cent of the equity released will go on home improvements, 11 per cent on debt repayment and 71 per cent on Christmas.” (The Sun p.43)

Economics

Mark Carney yesterday raised his doubts about George Osborne’s Help to Buy mortgage scheme, telling MPs on the Treasury Select Committee that there was yet to be any evidence that the scheme was encouraging more homes to be built. He told MPs that the main constraints holding back the supply of new homes were Britain’s difficult planning regime, and the shortage of construction materials.

And Chancellor George Osborne announced that he would be bringing forward a Bank of England review into the ‘leverage ratio’ from 2017 to this year. After intense pressure from his peers, the chancellor announced that he would be reviewing whether the Financial Policy Committee need additional powers over the leverage ratio, which controls the volume of risky lending by banks (The Times p.8)

Recruitment

The north-south divide in the jobs market has widened sharply, buoyed by a rise in construction vacancies in the South, according to the latest Jobs Report from job search engine Adzuna. Nine of the ten best cities to find a job were in the South of England, while nine of the ten worst were in the North, and it was 100 times more difficult to get a job in Salford, where there were 28 jobseekers per vacancy, than in Cambridge, where there were just 0.28 jobseekers per vacancy. (Financial Times p.4, The Sun p.10, Guardian p.25)

Whistleblowers require more protection, to encourage them to speak out about wrongdoing at work, according to a report by Public Concern at Work. Experts have made 25 recommendations to tackle the ‘culture of silence’ including simplifying and strengthening the Public Disclosure Act, adding measures to prevent the gagging or blacklisting of whistleblowers, and getting board-level staff to audit whistleblowing arrangements. Cathy James, chief executive of Public Concern at Work said: “We’ve had so many scandals and in each case there have been questions asked why people are not speaking up. It’s a problem that needs official attention.” (Daily Telegraph B6, FT p.23, Guardian p.37)

Wriglesworth Paper Summary 20/11/13

Economics

The Paris-based Organisation for Economic Co-operation and Development (or OECD) has revised down its expectations for global growth – to 2.7% this year, from 3.1% expected back in May. OECD economists cite the trouble in the USA over levels of government debt and the resulting shutdown, alongside the United States federal reserve and the effects of slowing down their digital money printing tactics. In the Financial Times, Martin Wolf discusses the limits on global growth and, perhaps controversially, puts the blame on an excess of savings across the world. (FT p.15)

However, for the UK, the OECD report was flowing with more optimism – for the time-being at least – as the British economy is set to grow by 1.4% in 2013, and by an expected 2.4% over the course of next year. (FT p.3)

Personal Finance

In today’s Independent, the front page blares the warning of “Britain’s next debt time-bomb”. As if the current struggles with government overspending weren’t enough, it seems that a new threat is developing from levels of personal debt. According to the Centre for Social Justice, 3.9 million British families lack savings to cover even one month’s mortgage or rent. In total, households owe the equivalent of 94% of the UK’s economic output, according to the CSJ. Meanwhile Andrew Grice, political editor at the Indie, says some ministers are concerned that excessively low interest rates are not encouraging people to pay down debt as fast as in some other countries.
(The Independent, p.1, p.14)

Property

Yorkshire Building Society is today announcing 36 new mortgage offers, adding to the spate of new 95% mortgages coming onto the market. According to the Daily Mail (page 10) , the number of 95% mortagges on the market has now reached over 100, up from 64 yesterday and 42 last month. But – there is still some way to go until lost ground is made up – the number of these 95% mortgages stood at 986 back in August 2007.

Recruitment

This morning’s City A.M. leads with the headline “Too many grads not enough jobs” –covering statistics released yesterday from the ONS on graduates in the labour market. Almost half of the UK’s recent graduates now in employment are not making full use of their skills, with 47% working in “non-graduate jobs”, where their work does not require a degree. Despite recent economic growth the graduate unemployment rate has also barely fallen since 2009, now standing at 8.82% compared to 8.99% four years ago in the brimstone of recession. In the Daily Telegraph, Andrew Hunter of jobs search engine Adzuna puts this in the context of wider improvements in the job market – with just 1.9 jobseekers now competing for each vacancy, compared to 2.3 at this point last year, though he adds, “But for those who are fresh out of university, the prospects of finding that first job remain gloomy”.

On a less gloomy note for graduates, a degree might still seem like a good idea compared to other routes – those with a degree still have much better chances than those without. On the other side of the fence, those with just GCSE qualifications have to wait until the age of 32 before their wages “level out at £19,000”. (The Guardian, p.7)

Paper summary, 16th November

Economics

Martin Weale, a member of the rate-setting Monetary Policy Committee, said that interest rates could remain at record lows even after unemployment falls below the 7% threshold set by the Bank of England. At a speech in London, Weale said that “a rise is not automatic” when the rate hits the 7% threshold, something the bank expects could happen towards the end of next year rather than in 2016. “It is perfectly possible that, as time moves on, the right thing to do will be to keep Bank Rate at 0.5pc even when unemployment has dropped below our 7pc threshold,” he said. (Daily Mail, p.96)

The Telegraph (p.39) reports that in the same speech, Weale also warned that the Sterling is too strong and must weaken if Britain is to secure a balanced recovery. While the pound’s recent strength had helped to ease the cost of living, he remained uncomfortable with its current value. The UK’s current account deficit is on course to hit a 25-year high next year, the worst of any major industrial country. This is made worse by the strong pound, making British exports unattractive and fuelling imports of cheaper goods from abroad.

 

Property

Knight Frank research predicts that house prices are set to soar by 24% over the next five years, pushing the price of an average three-bedroom semi to £185,833. In London, average prices will jump by £76 each day next year. Brian Murphy, head of lending at the Mortgage Advice Bureau, said: “The arrival of Help to Buy has been an integral part of improving the outlook for the wider property market.” (Express, Sarah O’Grady, p.4)

Britain has become a nation of downsizers, with almost half of homeowners planning to sell their property in the next three years to move into somewhere smaller, saving £100,000 on average. The research by Lloyds Bank found that more than a third of potential downsizers wanted to free up cash to support their retirement plans, while nearly half wanted to reduce their bills and outgoings. (Times, Kathryn Hopkins, p.8)

 

Personal Finance

The number of people switching bank accounts to Nationwide Building Society has risen by almost 50 per cent to more than 400 per day since the new rules on switching bank accounts were introduced. The increase in switchers to Nationwide was much more dramatic than across the sector as a whole, where reports of 11 per cent increases in switching were reported during the first few weeks of the scheme. (Times Business, p.51, Guardian, p.43, Daily Mail, p.96) The news signals the company’s ‘aggressive push into the current account market’ (FT, p.18) as a means of attracting new customers and offering them other products, and was announced together with their half-year financial results.

 

Recruitment

Youth unemployment poses a major threat to the global economy and will led to more crime and social unrest if it is not tackled, according to the World Economic Forum. The problem is particularly acute in the Eurozone where one-in-four under 25s who want a job cannot find work – in Spain and Greece, this proportion rises to half. SD Shibulal, chief executive of Infosys, who contributed to the report, said: “There is a growing consensus on the fact that unless we address chronic joblessness we will see an escalation in social unrest.” ‘The Outlook On the Global Agenda’ report was published on Friday. (Daily Mail, p.97)

 

Today’s Paper Summary: Monday 18th November

Personal Finance

“The fall in family finances will herald a bleak midwinter” according to the Times, reporting the latest Markit index, which shows household finances have dwindled as pay rises are outpaced by inflation in the run up to Christmas. In November, the index – which looks at perception of financial wellbeing – hit its lowest since April, as families left ill-spirited by diminishing household finance outnumbered those seeing an improvement by four to one. (The Times p.41, FT p.3)

Property

In the Express, Sarah O Grady writes that house hunters can ‘snap up a bargain’ in the run up to Christmas, as the market is  set to continue ‘booming’ in 2014. A report from Property analysts Rightmove shows that asking prices have fallen 2.4% so far in November, in line with a seasonal dip. But Rightmove director Miles Shipside said that their survey showed “widespread confusion among those who stand to benefit the most from Help to Buy.” David Whittaker of Mortgages For Business, said: “Buyers might find they can sneak in a good deal before Help to Buy stokes the property furnace in the New Year.” (The Daily Express p.7, The Times p.21)

Economics

Since the start of quantitative easing in 2009, British employers have pumped £182bn into defined-benefit pension schemes. Figures from the Pension Protection Fund reveal that in the financial year 2012-13, employers contributed £29bn worth of deficit reductions, and a further £18bn worth of ‘special’ payments. The Telegraph reports that ‘special payments in particular, are growing, to help tackle the deficit, with these payments consistently growing since quantitative easing was introduced. (The Daily Telegraph B1)

Recruitment

In his autumn statement on the 5th December, the chancellor is expected to endorse a shake-up in the government’s attitude to apprenticeships. In a move aiming to raise Britain’s productivity levels, and bridge the skills gap with countries like Germany, companies will be able to procure training for apprentices themselves, and they will be able to recover government subsidies through their tax return. It will put them in the driving seat and enable them to choose the apprenticeship schemes that best suit their staff, and their preferred training provider or college. But the Association of Employment and Learning Providers has warned that small companies with only one or two trainees could struggle with the new system.  (FT p.2)

Wriglesworth Paper Summary: Saturday 9th November 2013

Economics

Saturday’s economic news was overwhelmingly positive for prospects in both the US and China. Speculation has grown that the Federal Reserve will begin winding down America’s economic stimulus next month grew last night after the latest stats for jobs growth smashed expectations on Wall Street. Larry Elliot reports in The Guardian the US economy has recently created 204,000 jobs – way above expectations – on the back of above-forecast 2.8% annualised growth in the third quarter. (The Guardian, p.44)

Meanwhile, the Chinese economy has seen a strong rebound in exports – rebounding from a surprise slump in September with 5.6% annual growth in October. The numbers come as China’s leaders “prepare to set the fiscal and political direction for the next decade.” (FT p.8) In The Express, Peter Cunliffe comments on the impact of this manufacturing business – with China “ sitting on £2 trillion of foreign earned as manufacturer to the rest of the world”, and potentially using London as the centre of its investments of that money in the rest of the world. (Daily Express,. P.28) however, in The Independent Anthony Hilton writes on “why the City should be wary of banking too much on the Chinese” where he writes that while stuffed with cash, Chinese banks are far from immune from overstretching themselves, and are “notorious for being potentially among the most toxic in the world” (The Independent, p. 53)

Personal Finance

In Saturday’s Times Mark Atherton sets out the “tariff tart” approach to cut down on energy bills. Apparently, serial switching is the only way to cut down your costs as gas and electricity retail prices continue to increase dramatically. Atherton reports that one smaller supplier, Utility Warehouse, has ordered a 31.6% increase for some electricity customers. To avoid such surprises, reading all the small print form suppliers and switching as soon as anything unexpected arises is the only way it appears. “Active customers” should even be prepared to leave a fixed rate deal before it expires in order to pocket longer term savings, with Mark Todd of price comparison site energy helpline, commenting, “You need to be continually on your toes. If you are prepared to do this, you should be able to enjoy annual savings of £200 to £300 compared with what you would pay on the average standard tariff.” (The Times, p.67)

Property

Property Developers must start building new homes right away, or lose planning permission, according to the Planning Minister Nick Boles. A change in regulations is intended to “prevent land banking” and bring forward new building rather than allowing developers to simply make money out of rising land prices and the value of planning permission. The move against holding land now has cross party support, with the official Coalition policy now in agreement with Ed Miliband’s pledge to outlaw the practice at his conference speech in September. However, Nick Boles insists this particular measure “to extend planning permission has always been temporary…” (The Daily Telegraph, p.1)

Recruitment

An advert for a job in PR was advertised as “for men only” on the Guardian website. Proctor and Stevenson, a design company, were seeking a PR manager for £45,000 a year but due to their middle-eastern clients and “travel and work restrictions” for women in the area, the company needed to “restrict [their] candidate selection to males only” (The Times, p.41)

News Headlines – Tuesday 13th August 2013

Economics/Property
The Times leads with a piece on the “flood” of first-time buyers returning to the market, according to data released by the CML. The Financial Times says the government is facing calls to drop its controversial Help to Buy scheme to prevent another housing bubble as FTB lending rose to a post-2007 high. The number of mortgages advanced to FTBs reached 68,200 in the second quarter of this year, the largest quarterly total for five and a half years. There are warnings the government’s support risks putting house prices further out of reach of FTBs. Average house prices have already topped their previous 2008 peak, according to the LSL/Acadametrics Index. FT, p.2

Personal Finance
Annuity rates are now so bad that holders would have to live to 90 to get value for money according to government pensions adviser Dr Ros Altmann. Millions of pensioners face a gamble when turning their nest eggs into retirement income. Annuity rates are at an all-time low due to a combination of low interest rates, rising life expectancy and the government’s policy of quantitative easing. Pensioners who buy annuities at 65 would not get their money back unless they lived to 82 and would not get value for money unless they lived to 90. Daily Mail, p.1,4

Employment/recruitment
On the front page of the Telegraph, HSBC research suggests rising numbers of students are shunning arts degrees in favour of more practical degrees. Applications for engineering degrees rose 17% between 2007 and 2012. Telegraph, p.1; Daily Mail, p.12