Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

Missing older workers ‘weigh on economy’s growth potential’

by February 3, 2023
February 3, 2023
Missing older workers ‘weigh on economy’s growth potential’

The exodus of workers from the jobs market over the pandemic has weakened prospects for Britain’s economic growth, the governor of the Bank of England has warned.

About half a million workers left their jobs over the pandemic with no plans to return to work. Some of the rise was caused by the ageing of the population, which meant a greater share of workers reaching retirement age, but the trend was mainly driven by older workers aged between 50 and 64 who retired early, or were forced to resign due to long-term sickness.

“A number of these people say they are unlikely to come back into the labour market,” Andrew Bailey said after the central bank’s decision to raise interest rates yesterday. “This significant and lingering fall in the labour supply weighs on the UK economy’s potential.”

Unemployment is close to historic lows but it is not because more people are in work. Employment remains below pre-pandemic levels, while the number of people who are “inactive” — meaning they are neither working nor available for work — at historically high levels.

Bailey added that the fall in participation “will take time to unwind . . . So we have revised down our estimates of the trend in participation with persistent effects from Covid adding to population ageing.”

Growth in labour supply is weak by historical standards, with the recovery expected to be gradual, according to the Bank’s latest forecasts.

Separately, the Bank questioned the International Monetary Fund’s assessment of the UK economy as the worst performing in the rich world this year — and the only economy with falling growth.

The fund downgraded the UK’s growth this week to a contraction of 0.6 per cent in 2023, close to the Bank’s new forecast of a 0.5 per cent decline. But the IMF’s outlook on the UK was more pessimistic than its upgraded projections for the world economy, the US and Europe.

Sir Dave Ramsden, deputy Bank governor, said the fund had not disclosed what assumptions were behind its downgrade, but said it was likely that the IMF expected inflation to remain higher for longer. By contrast, the Bank cut its inflation forecast. It now expects consumer prices to fall to 4 per cent by the end of the year, driven by falling energy prices and better international supply chains.

“We haven’t got the details of the IMF update but we think they assume more persistence in inflation. They’ve got more wage and price pressures which feeds through into the forecast” Ramsden said.

Ben Broadbent, deputy governor for monetary policy, said he was “careful of comparisons” with other economies, noting that the IMF’s outlook was likely based on the UK’s heavy reliance on gas compared with other countries and the impact that higher interest rates would have on borrowers.

“All of these things are not going to endure forever so I don’t think one should expect this to tell you about trends over the next four or five years,” Broadbent said.

Read more:
Missing older workers ‘weigh on economy’s growth potential’

0
FacebookTwitterGoogle +Pinterest
previous post
Christopher Cane On His Role As a Professional Firefighter
next post
Getting To Know You: Will Polston, founder, Will Polston Coaching & Training

You may also like

Gary Lineker’s lawyers say HMRC tax inquiry ‘looking...

February 28, 2023

4 ways a TMC can unlock exclusive travel...

January 16, 2023

One in ten startup owners blame the Government...

November 22, 2023

Begbies Traynor predicts surge in insolvencies following budget...

November 18, 2024

National Apprenticeship Week: Using apprenticeships as a workforce...

February 2, 2024

Ultra-high energy bills are here to stay

August 2, 2022

Google to face multibillion-pound lawsuit from UK consumers

September 7, 2023

Help over-50s start their own business to boost...

July 20, 2023

Aston Martin hopes for share price boost after...

May 3, 2023

Waitrose shoppers survey shows fish heads and spam...

October 20, 2022

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Call with China’s Xi, and Trump-Musk exchange fueled barbs during 20th week in office

      June 7, 2025
    • Trump’s conservative allies warn Congress faces critical ‘test’ with $9.4B spending cut proposal

      June 7, 2025
    • Tech ETFs are Leading Since April, but Another Group is Leading YTD

      June 7, 2025
    • TIMELINE: Inside the evolving relationship between Trump and Musk from first term to this week’s fallout

      June 7, 2025
    • Deadly drone wars are already here and the US is horribly unprepared

      June 7, 2025
    • Week Ahead: NIFTY’s Behavior Against This Level Crucial As The Index Looks At Potential Resumption Of An Upmove

      June 7, 2025

    Categories

    • Business (8,152)
    • Investing (2,019)
    • Politics (15,564)
    • Stocks (3,136)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved