Northern Ireland sometimes gets characterised as a naval-gazing backwater, where overly conservative views and inward-looking discussions dominate. But whilst we have to acknowledge that there is some truth in this, I don’t think we always get enough credit for the many things from here that are out of this world. Recently, NI’s creative talent was on display at both the Superbowl and the BAFTAs, and is set to be showcased in Hollywood soon as well. Many companies from here are high achievers on a global scale too, and on the sporting front, the Irish Rugby team is currently world number one. It’s also encouraging that NI PLC is looking to the stars as well, with the UK Space Conference coming to Belfast later this year.Continue reading
Coming back down to earth but into a different world
If we look at the last 14 years, the reality is that we have been in a bubble that has sent many things such as global property and equity prices to stratospheric levels. This bubble was created by extremely low interest rates and was pumped up further by other central bank actions including quantitative easing (QE). But now the bubble is deflating fast as interest rates rise due to soaring inflation, and we’re experiencing an extremely bumpy re-entry as we come back down to earth. But whilst we’re re-entering the higher interest rate environment of old, it is a manifestly different world.Continue reading
Mr Whippy has 99 problems but Brexit ain’t actually one of them
It could be said that we have a Ketchup bottle economy at the minute. Shake a ketchup bottle and nothing happens. But eventually we will get covered in red sauce as the blockage is worked free. Something similar is happening in global supply chains at present and this is impacting on all of our lives.Continue reading
Like Brewster, NI’s millions must secure long-term legacy
In the 1985 film Brewster’s Millions, Richard Pryor’s character is left a £300 million fortune. Provided Monty Brewster meets the challenge of blowing $30 million in 30 days he can keep the whole estate. Simply giving the money away though is forbidden and there are limits on gambling and donating to charity. The lead character embarks on a spending spree and fulfils the conditions of the will, therefore inheriting the lot.
Will we see a Brewster style spending spree in the global economy in the months ahead? Some think so. Over $5 trillion dollars of savings have been stockpiled by consumers around the world with household savings rates in many countries reaching century highs. As lockdown restrictions ease the expectation is that we will see a strong rebound in consumer spending from two sources. First, pent-up demand will be unleashed as spending patterns normalise. And second, we should see an unwinding of the forced savings squirreled away during lockdown. This boost in consumer spending, which accounts for around three-quarters of Northern Ireland GDP, will fuel an economic recovery globally, nationally and locally.Continue reading
This will go down as the weirdest recession yet
If someone had told us a year ago that we were going to go through the deepest recession in a century and end up with an unemployment rate of just 3.7%, this probably would have been considered absurd. Logic would dictate that a double-digit contraction in economic output would create a double-digit unemployment figure. But there has been little logical about the past year – as the Sunday Times columnist David Smith succinctly described it, it has been “the deepest recession, but also easily the weirdest”.Continue reading
Sunak’s 15th fiscal announcement beckons…
It’s hard to believe that when the Chancellor stands up at the despatch box on the 3rd March, this will be only Rishi Sunak’s second budget, and comes 51 weeks after his first. However, in that intervening period he has made another 13 fiscal announcements, with the Coronavirus Job Retention Scheme (i.e. furlough scheme) the most significant.Continue reading
The year of pent-up demand and pent-up problems
January 2021 represents more than just the start of a new year. It marks the new post Brexit-era, and it brings us a step closer to a post-Covid era with the ramping up of the vaccine roll out. In some respects, this month therefore marks a turning point for Northern Ireland and our economy, and a time when we should really take stock of where we are and where we are going in the future.Continue reading
Eat. Sleep. 3Rs. Repeat?
For decades, the most important basic skills taught in schools were the Three “Rs” – reading , (w)riting and ‘rithmetic. In recent decades, becoming ICT literate has been added to these functional skills of literacy and numeracy. While the texting and Xbox generation have become adept at embracing technology, more so than older generations, the same is not necessarily true for literacy and numeracy. Too many of our young people leave school without mastering these basic skills. This leaves them ill equipped for the world of work and dealing with life in general. Are we doing enough to address this? Every August (bar the one just passed) social media is awash with stories on results day. Best grades ever etc. You would be forgiven for thinking we had a world class education system. That holds true for some but it is a lousy system for a significant number of others. Northern Ireland society’s fixation with school league tables breeds a one-dimensional view of educational performance. Meanwhile, Northern Ireland continues to churn out a higher proportion of school leavers without any qualifications than any other UK region. This fact receives little airtime but we can’t sweep it under the carpet. We have an unusually high tolerance threshold for this failure in our education system. This is surprising when you consider the cost associated with the social problems that flow from these sub-optimal education outcomes.Continue reading
A decade lost and found…
The past 10 years has perhaps been one of the most astonishing decades in history – from an economist’s perspective anyway.
When we think back to April 2008, Amazon was still seen as a niche bookseller, Facebook was a corporate minnow and we went to Xtra-vision for movies.