Yes, quite so

Instead of the impact of recession being concentrated in pockets of unemployment – as it was in the mid-1970s, the early 1980s and the early 1990s – the pain has been spread around in the form of pay restraint for all.

This was the point of the Thatcherite labour market reforms. Good thing they worked too, eh?

7 thoughts on “Yes, quite so”

  1. The torpor of the 2010s is much harder to explain.

    Two simple answers. First, the hangover of the excess growth in the 2000s. We had a boom, but the BoE averted the bust by slashing rates, at the cost of low growth in the 2010s. Second, more people entered the workforce at the bottom. Changes to benefits and raising the income tax threshold made work pay for the low-paid, and the rise in internet / smartphone work also played a role (Uber, most famously; but also piece-work like Etsy).

    If Larry can’t answer the question, why do the Guardian still keep him on as economics writer?

  2. Andrew M,

    “and the rise in internet / smartphone work also played a role (Uber, most famously; but also piece-work like Etsy).”

    My question is: do you feel poorer? I think we’ve had massive deflation down to all sorts of innovations in how to get the stuff we want, but not much new expensive stuff that people desire. People in the 90s or 2000s got richer and could say, afford weekend breaks. They aren’t doing even more weekend breaks, or buying even more cars, or buying even more laptops. They’re doing the same number, but getting it cheaper.

  3. If Larry can’t answer the question, why do the Guardian still keep him on as economics writer?

    Because he can be relied upon to write what all the bearded loons and blue-haired harpies who buy the paper want to read. Same as any columnist in any paper, I suppose. The trick is to laugh at any qualifications, titles or expertise they claim to have.

  4. Bloke on M4 – I do weekend breaks. Cheaper they are not.
    Something to do with rise in minimum wage maybe? Costs have risen.

  5. “the BoE averted the bust by slashing rates, at the cost of low growth in the 2010s”

    But here on the continent it’s supposedly the very existence of a means of exchange that caused the low growth, not low interest rates coupled with being at the bleeding edge of technology. Damnit, the anglosphere got first dibs on all the good excuses again.

    “They’re doing the same number, but getting it cheaper.”

    With the surplus left over from having cheaper stuff driving up asset prices.

    “I do weekend breaks. Cheaper they are not.”

    Depends how you travel and stay, doesn’t it. You can, if you wish, still fly around Europe in mid-1980s economy class style (and price), They just call it business class these days. And stay in a central hotel, eating only at Michelin-starred restaurants. Or you can fly much more cheaply (if less comfortably and less time-efficiently) than back then, rent an airbnb, and eat at a kebab shop. Up to the customer, innit.

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