Thursday 21 June 2012

UK household consumption - no growth



Nobody, apart from Jimmy "the crafty dodger" Carr, has any money these days. And he has all of his locked up in a trust fund.

We certainly aren't spending much. Real household spending growth has been in the tank since the crisis started back in the summer of 2007. Last year - 2011 - was a particularly one when consumption fell in each of the first three quarters. Overall, we are a long way south of the pre-crisis peak in consumption spending. Things aren't likely to get better anytime soon.

Why aren't UK households spending? Dumb question; real incomes are down. Assuming that you aren't in the business of insulting defenceless mentally disabled children and calling the output a carefully crafted joke, then you are probably getting poorer. In 20011, household real post-tax income fell by a growth sapping 1 percentage point.

If only we could all dodge a little tax then perhaps things would get better. Perhaps, Mr. Osborne could arrange it for us by cutting the tax rate when he cooks up his next budget. However, I don't think that idea would go down too well with our liberal tax dodging guardian reading elites.

2 comments:

Anonymous said...

Fear is playing a part, and the unwinding of debt positions as people pay down their excess. The tirade of misinformation from the state within a state broadcaster is not helping either.

Anonymous said...

Fear is playing a part, and the unwinding of debt positions as people pay down their excess. The tirade of misinformation from the state within a state broadcaster is not helping either.