1 South Africa may be heading for recession (Johannesburg Times) South Africa is at risk of going into a recession, according to BankservAfrica’s Economic Transaction Index (BETI). This was after the BETI for May dipped below zero after five months of decline. “Not even two extra working days in May, spending around the election, and the inauguration of the president could prop up the numbers,” economists.co.za chief economist Mike Schüssler said in a statement.
Schüssler noted that with international commodity prices of South African exports also in decline, the added pressure is tipping the balance in favour of further shrinkage of the economy. BankservAfrica corporate reputation head Michael Rubenstein, said May’s decline was not the real concern, but rather the continuous overall decline the BETI had shown over the past five months.
“There is no golden rule between the BETI and GDP growth in exact terms, but it is clear that the year-on-year GDP will decline, especially given the historical connection between the two,” said Schüssler. The only encouraging factor was the positive internet traffic growth over the past year.
“With other potential and actual strikes also coming to the fore, the South African economy is showing more signs of decline,” he said.
2 Jobs boom, but not living standards (Robert Peston on BBC) So there are some very striking – and perhaps odd – things going on in the jobs market. Much of it looks positive – such as the 345,000 increase in people in work during the three months to April. Which is the biggest quarterly rise in employment since records began in 1971.
Now if depressions were measured by the employment rate, the UK depression would be officially over – because the employment rate is now 72.9%, which is 0.1 of a percentage point higher than before the start of the slump at the beginning of 2008. And the employment rate is only a whisker below it’s all-time high of 73.1% – attained in early 2005 and in late 1974.
If the most important thing about an economy is the way it provides gainful employment, then the UK is doing pretty well. It is all splendidly wonderfully tickety boo, n’est-ce pas?
And then there are some other trends material to how we feel about all this jobs growth. Total pay rose just 0.7% in the three months to April, and pay minus bonuses increased just 0.9% – both well below the 1.8% rise in CPI inflation that month. Or to put it another way, real pay – having increased marginally for a few weeks – is falling again.
There is no sign that what we are paid is rising faster than the cost of living – except in manufacturing, shops, hotels and restaurants. One other thing, quite a profound shift in the balance between public and private sectors in the British economy since the financial debacle of 2007-8, can be seen in the jobs figures. For most of 2009, the public sector provided 22% of all employment in the UK. That had fallen to less than 18% by April of this year – and looks to be on a declining trend for some years yet.
3 Uber threat to global taxi drivers (San Francisco Chronicle) Taxi drivers in London, Paris and other European capitals protested on June 11, against unlicensed mobile car-hailing services such as Uber which have shaken up the industry. About 30,000 taxi and limousine drivers across Europe participated in the protest.
Taxis drivers block a highway outside Paris, as they take part in a demonstration to protest against the growing number of minicabs, known in France as Voitures de Tourisme avec Chauffeurs (VTC).