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ECONOMIC DATA THIS WEEK

UK GDP, 4th Quarter 2015:  The Office for National Statistics (ONS) has released updated figures for the UK economy at the end of last year;  there is no change to the growth rate for the 4th quarter which shows an increase of +0.5% compared to the previous period or for the full year estimate which remains at +2.2% for 2015.

There have been some revisions to the quarterly profile during 2015, with the 2nd quarter growth rate now put at +0.6% (from +0.5%) and a small downward change to the 3rd quarter (but unchanged at one decimal point at +0.4%).  There is also an upward revision to the data for the 1st quarter of the year, but this only comes out in the comparison with the 1st period of 2014 and the quarter-on-quarter rate was unchanged at +0.4%.

You can download the ONS Statistical Bulletin from their web-site at www.ons.gov.uk or request it from MTA.

CBI Industrial Trends Survey, February 2016:  There was little change in the overall picture in February with both total and export orders hovering around long-run average levels and output remaining flat.  However, it is worth noting that the most positive sector in terms of orders was Motor Vehicles and the most negative was Mechanical Engineering (usually referred to as Machinery) - very contrasting fortunes for these two key industries for the manufacturing technology sector.

The CBI reports that expectations for production over the coming 3 months were positive for the 2nd month in a row, but remain relatively modest.  Once again there is a sharp contrast between Motor Vehicles which contributes to the overall growth rate while Mechanical Engineering reported its largest drop since the survey began in 1978!

You can read the CBI News Release on the survey at their web-site (www.cbi.org.uk, click on “news” and scroll to 22 February) or contact MTA for a copy of the summary of the survey report.

UK Business Investment, 4th Quarter 2015:  The provisional data from the ONS shows that total business investment fell by -2.1% compared to the previous quarter, but the year as a whole was +4.7% higher than in 2014.

Spending by asset shows a quarter-on-quarter fall of -13.6% (to £3.3 billion) for Transport Equipment and an increase of +1.9% (to £15.9 billion) for “ICT Equipment and Other Machinery and Equipment”.  The trends for these two categories for 2015 as a whole were growth of +43.6% and +1.9% respectively.

We don’t get the breakdown of spending by sector and industry until the revised figures are published in a month’s time.

You can download the ONS Statistical Bulletin from their web-site at www.ons.gov.uk or request it from MTA.

International Comparisons of Productivity - 2014:  The final estimates published by the ONS had an interesting breakdown by broad sectors of the economy.  Overall, the UK’s productivity performance is relatively poor, although there has been a modest improvement in the last year or so, and we lag behind most of the other G7 economies - the exception is Japan - on both the output per worker and output per hours measures.

While there are a number of caveats around the data by sector, relating to issues such as the measure of output used and exchange rates (and it is not available for Japan or Canada), it does show manufacturing productivity per worker ahead of the other European economies and behind (although by a long way) the USA.  However, because of the longer hours worked in the UK, the picture on productivity per hour worked is less positive, but we remain ahead of Italy.

This latest analysis also shows that private non-financial services is the main sector in which the UK is far behind all of the other countries on both the output per job and output per hour comparisons.  This is also the largest of the sectors that the ONS have included in their report and so has the largest impact on the whole economy data which is usually quoted in headlines about productivity.

You can download the ONS Statistical Bulletin from their web-site at www.ons.gov.uk or request it from MTA.