All the day’s economic and financial news, including the latest trade figures from China and a Bank of England Agents report
- Latest: UK companies expect higher pay rises in 2018
- Worries about future trading hit business spending
- Wall Street banks: we’re near Brexit ‘point of no return’
- Chinese exports fell last month
- US trade gap still wide as Trump arrives in China
UK recruitment firms say British employers are having to offer bigger pay rises, to cope with a shortage in workers from the EU.
Reuters has the details:
The Recruitment and Employment Confederation said its monthly survey showed starting salaries rose in October at the second-quickest rate since November 2015.
“We already know that EU workers are leaving because of the uncertainties they are facing right now,” REC chief executive Kevin Green said.
British workers really do need a pay rise.
As these chart shows, real wages have been shrinking since the spring as inflation has rattled up to 3% – mainly due to the slump in the pound after the EU referendum.
UK firms seem to be particularly reluctant to commit to new offices and factories.
The Bank of England’s agents found that firms expect to invest less in 2019 and 2020, as they await more clarity about Britain’s economic future and how Brexit will play out.
Firms in the survey expected investment growth to be little changed over the next twelve months, relative to the past twelve months.
However, investment growth was expected to be somewhat weaker over the following two years.
Bank also shows most firms saying they expect investment growth to be little changed in 2018, before weakening over following two years pic.twitter.com/7TS1QAPUL7
Breaking: UK companies are struggling to recruit new staff, and expect to hand over larger pay rises next year.
That’s according to the latest survey from the Bank of England’s regional agents, just released.
Recruitment difficulties had intensified and were above normal in a range of activities, alongside continued modest employment growth. As a result, pay growth had edged up and was expected to be somewhat higher in 2018 than this year.
Our robot overlords are clearly biding their time. Latest Agents survey reports firms facing increased recruitment difficulties. pic.twitter.com/zfi21FjQCz
Investment plans were being boosted by companies’ desire to increase their efficiency and to meet expected increases in demand, but expectations about the United Kingdom’s future trading relationships were dragging on spending.
Manufacturing output growth had risen again, with export supply chains supported by the past fall in sterling and some signs of increased domestic sourcing. But construction output growth had eased. Services turnover growth remained moderate.
Anne-Sylvaine Chassany, the FT’s Paris bureau chief, reports that Bank of America is pressing on with its plans to move 300 staff from London:
Britain’s Big Six could soon be the Big Five.
No, not in the football (before any long-suffering Arsenal fans cry foul), but in the energy market.
Especially after the government’s recent pledge to control price increases for the most vulnerable to fix what many regard as a broken market, where prices continue to rise despite a move towards renewables. Big six to big five doesn’t exactly scream “consumer benefit”.
Marks & Spencer also reports that its food sales — usually so buoyant – dropped by 0.1% in the last six months.
The food business has been keeping M&S afloat in recent years, but now progress seems to be flagging here, the clothing division needs to start pulling its own weight. The festive period also looks set to be challenging for the high street. Real wages are around 0.5% lower than they were last year, and the recent interest rate rise might well make consumers think twice about loading up on debt to fund the annual Christmas splurge.
For M&S it’s still early days in the turnaround plan, and it’s unfortunate that the retailer’s structural issues have been compounded by tough times in the industry as a whole. There won’t be any champagne accompanying the marmalade sandwiches at M&S HQ, it’s a quick brew, then back to work.’
Over in the City, shares in Marks & Spencer have dropped by more than 2% after it announced it is speeding up its turnaround plan.
Chief executive Steve Rowe warned that M&S still faces “many structural issues”. The firms now plans to open fewer new Simply Food outlets, and accelerate the closure of other stores.
M&S CFO Helen Weir to step down, accelerates plan to close 30 U.K. stores
Brexit continues to loom over the City of London, as the clock ticks towards 31 March 2019 when the UK is scheduled to leave the EU.
Those briefed on the talks, which were held over lunch at Wilton’s restaurant in London’s exclusive St James’s district, said the banks were particularly concerned by the failure of Britain to provide clarity over whether it will secure a transition deal to smooth the changing regulatory regime after the UK leaves the EU.
They warned they had even less clarity over what a final Brexit deal will look like.
Donald Trump warned of our chaos.
Just let that sink in. pic.twitter.com/Y5dAbCiJtw
China’s trade figures landed shortly before Donald Trump touched down in Beijing for a state visit.
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
New trade figures from China have missed expectations, which may be a sign that global growth isn’t as punchy as we hoped.
“The big picture is that both outbound and inbound shipments have softened recently, a trend that continued last month.
“We suspect that this reflects a slight easing of growth in other emerging markets along with weaker domestic demand as a result of slower infrastructure spending.”
China’s Oct Iron ore imports fall to lowest in 2.5 yrs, Steel exports drop 3%
& I can practically fill in the most important points of China’s trade data but then its not all very relevant..I still have characters left..Not sure what to write..More characters..& more…Ok done
China is making a concerted effort to move towards a more service focused economy. That being said, their demand for minerals is still a major driver of commodity prices and mining companies.