GDP back to pre-recession levels… but here’s what today’s economic figures don’t tell you

It’s party time at the House of Commons, as the Office for National Statistics today revealed our GDP is back to the level it was before the recession.

It was up 0.8% in the second quarter of this year compared with the same period in 2013.

This morning David Cameron and George Osborne seemed pretty pleased:

 

Which is the political equivalent of:

But wait.

While this is, of course, great news for Britain’s economy, if we take a closer look, things are not quite as wonderful as they seem.

GDP per capita is down

If you spread GDP out over the whole population, it’s actually still 6% lower per capita than it was before the start of the recession (because of population growth).

The slowest recovery in 100 years

The UK recovered quicker from the recessions of the 1920s, 1930s, 1970s, 1980s and 1990s than from the one we’re in now. And some of those recessions were deeper, too.

If you think you’ve had a pay rise, you probably haven’t

The rate of inflation, which is around 1.9% at the moment, means everything is costing more. That’s the norm, and is totally fine if your pay is going up at that rate too.

But most people’s wages aren’t going up in line with inflation – in fact the average annual pay rise is only 0.3%.

So unless you’re getting a 2% annual pay rise (or more), you’re taking a pay cut in real terms.

Big fat debt

Debt graph

Earlier this week we wrote about how our national debt has climbed to £1.3 trillion – the highest level ever.

We’re borrowing more and more

The deficit is now at £11.37bn – way more than the £7.59bn it was in June 2013.

And good luck getting on the London property ladder - particularly if you’re under 30

London house prices rose by more than 20% in the year to May.

The average London property is now worth £492,000.

In June, people aged 18-30 made up just 3% of buyers.

Property buyers graph

Sorry. Enjoy the rest of your day.

 

What do you think about the latest figures? Tweet me @robynvinter

Button - LinkedIn

Social Bookmarks