Published: 17 January 2023
By Suzanne Evans, Director, Political Insight
The Office for National Statistics (ONS) has published its latest jobs data this morning. The statistics for the three month period from September to November show that the unemployment rate held at 3.7%; employmentwas 75.6%; and economic inactivity was 21.5%. The number of employees on payroll continued to grow in December 2022 and is now 888,000 above its pre-Covid level. There were 1.161 million job vacancies on average across October to December 2022, putting the number of people looking for work in broadly in line with the number of jobs being advertised. However, this was down 75,000 on the previous quarter. Total actual weekly hours worked dropped to 1.036 billion, down 10 million on the previous 3 months, and still 16.3 million below pre-covid levels. The ONS noted that the rate of inflation means real wages shrank by 2.6% over the period, despite pay hikes of 6.4% both including and excluding bonuses. Independent economist Julian Jessop said on Twitter this morning that he found the data “reassuring,” noting that unemployment remains very low; employment is up; and that while wage growth is still below inflation, the same is “smaller than feared” and smaller “than in the rest of Europe.”
The ONS also said this morning that the period since June has seen more days lost to strike action than during any other six months in the last thirty years.
Teachers in England and Wales are the latest to announce that they will join nurses, rail workers and others in staging industrial action on 1st February. 100,000 public sector workers are due to strike then, in what could become Britain's biggest day of co-ordinated industrial action for decades, the BBC says. The teachers’ strike will see 23,400 schools in England and Wales affected. Teachers in Scotland have already held strikes which have closed many schools. The National Education Union says 90% of their members voted to strike in England on a turnout of 53%, meeting the legal turnout threshold for action to proceed, while in Wales, 92% voted ‘yes’ to action, on a 58% turnout.
The Royal College of Nursing (RCN) union also says tens of thousands of nurses in England will walk out for 12 hours each on 6th and 7th February if "progress is not made by the end of January" in pay negotiations with the government. This will be their third strike in as many months.
Bank of England Governor Andrew Bailey told parliament's Treasury Select Committee yesterday that he was not sure if a digital pound was needed. "I think it's an open question whether a wholesale digital central bank currency is needed because we've got a wholesale central bank money settlement system with a major upgrade," Bailey said, adding: "We have to be very clear what problem we are trying to solve here before we get carried away by the technology and the idea”. Bailey was also cautious about a digital pound for retail use such as for making payments, adding there is no plan to abolish cash. Meanwhile, euro zone finance ministers said yesterday that they backed continued preparatory work for a potential digital euro, now being studied by the European Central Bank. The EU is due to publish a draft law this year on how a digital euro would fit into the bloc's laws.
Britain has been named jointly with Germany as the third most attractive place in the world to grow a business, the Daily Mail reports, level pegging with its European ally for the first time in the 26 years of the report. Only the US and China were ranked higher in the poll by auditing giant PwC,published at the start of the World Economic Forum’s (WEF) annual gathering of global business and political leaders in Davos, Switzerland.
115 bids have been received from 76 companies to drill for new oil and gas in the North Sea, the North Sea Transition Authority (NSTA) which regulates the sector said. The Government opened a fresh round of licensing after a three-year hiatus because of the energy security crisis. The NSTA said the bids, covering 258 "blocks" of the sea, will now be studied, and those that go ahead could begin production in as little as 18 months. Climate Minister Graham Stuart said: "Putin's illegal invasion of Ukraine has led to volatile global energy markets. It's fantastic to see such interest from industry in this round, with the awarded licences set to play an important role in boosting domestic energy production and securing the UK's long-term energy security of supply." Meanwhile, the Scottish government has announced a presumption against new oil and gas exploration as part of its new energy strategy, with Scottish ministers saying they can no longer support the previous position of "maximising economic recovery" of fossil fuel reserves.
British Gas has started a price war for heat pumps. The Centrica-owned firm has priced supply and instillation of an air source heat pump at £2,999, £1 lower than charged by rival Octopus Energy. British Gas said it had installed more than 2,300 heat pumps so far. The Government wants 600,000 heat pumps installed each year by 2028, compared to about 40,000 in 2021. The price offered by British Gas includes grants offered in England and Wales of £5,000, its website says. Under the Government's Boiler Upgrade Scheme, homes can get grants of £5,000 for an air source heat pump, £6,000 towards a ground source heat pump, and £5,000 towards a biomass boiler. The Scottish Government offers grants of up to £7,500.
FTSE 250 security and defence contractor QinetiQ has won an £80m 10-year contract with the Ministry of Defence (MOD) to provide specialist mission data and electronic warfare skills alongside training and IT support.
Barnsley-based ABI Electronics has been awarded a new “high-level contract” by the South Korean Army for the supply of more British-made sustainable electronic diagnostic and reverse engineering systems, the firm said. It is the third contract the army has awarded to ABI since 2021.
As predicted by Bloomberg in yesterday’s Daily Business News, Swiss chemicals company Sika has struck a deal with UK rival Ineos, to help clear the way for its £5bn acquisition of MBCC Group. Ineos subsidiary Ineos Enterprises has agreed to acquire MBCC's admixture business in the US, Canada, Europe and the UK, as well as its entire operations in Australia and New Zealand. The deal includes the production sites and sales offices of the business, which employs more than 1,600 people and generated net sales of around CHF920m (£815m) at the end of 2022. Financial terms were not disclosed. Sika and MBCC agreed to sell the assets last December to address competition concerns raised by the Competition and Markets Authority. Subject to regulatory approvals, Sika said it now expected the acquisition of MBCC to complete in the first half of 2023.
The founder of catering equipment supplier Nisbets is reportedly plotting a £500m-plus sale that would catapult his family into the ranks of Britain's super-rich, Sky News reports. Andrew Nisbet, whose business has become a multinational distributor to the food-service sector, has instructed Goldman Sachs to sound out prospective buyers. Any deal would be likely to value Nisbets at well in excess of £500m, with sales in 2021 of £420m showing a 34% increase on the previous year, Sky cited insiders as saying. Nisbet founded the company in 1983, and his family owns 100% of its equity. The company is understood to be debt-free, with earnings before interest, tax, depreciation and amortisation more than doubling in 2021, the last year for which results are available, to £42.6m.
Chinese ride hailing firm Didi Global has been given the green light by Chinese regulators to resume new user registrations, it confirmed yesterday. Didi, founded in 2012, attracted a string of high-profile investors and made its $4.4bn debut on Wall Street in 2021, before a far-reaching crackdown by Beijing on China's booming technology sector effectively forced it to stop trading when it was ordered it to remove mobile apps from app stores and suspend the registration of new users. Didi was also fined it $1.2bn over data-security breaches, and in June last year the firm delisted from the New York Stock Exchange. Yesterday Didi said in a statement: "With the approval of the Internet Security Review Office, new user registration on Didi Chuxing will resume immediately."
Bitcoin broke back through the $21,000 mark in trading yesterday, a considerable movement from a low of $16,000 at the beginning of the year. The world's largest digital asset by market capitalisation surged almost 25% in a week to $21,069. Only one week ago bitcoin was still hovering around the $17,000 mark. Other cryptocurrencies such as ethereum and solanahave also risen considerably over the same time. Yahoo Finance attributes this capital inflow into the cryptocurrency sector to renewed investor confidence that the US Federal Reserve is taming inflation without casting the economy into recession.
And finally… a British businessman who set up a community bank in his home town told the BBC he is "living the dream" after his story was made into a Netflix film. Actor Rory Kinnear plays Dave Fishwick in the movie, called Bank of Dave, which premiered on Sunday. The self-made millionaire opened Burnley Savings and Loans in 2011 to lend to people struggling to secure loans from bigger banks following the 2008 financial crisis, when major high street banks went into meltdown. Last year, the ‘Bank of Dave’ loaned around £27m to thousands of people and businesses, donating profits back into the community.
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