Economy Monitoring Monthly Update - (EMMU) March 2022 Economic Growth Service Economic Growth and Development Part of the Intelligence Network
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Information Classification: PUBLIC Economy Monitoring Monthly Update (EMMU) March 2022 Economic Growth Service Economic Growth and Development Part of the Intelligence Network
Information Classification: PUBLIC
Commentary
Overview
The UK economy was in recovery mode with both PMIs and output increasing. A tight
labour market was evident. Consumers were far less optimistic with confidence falling
back further.
Labour market data shows that the number of employees continued to increase with
numbers now above pre-pandemic levels (though self-employment is lower).
Consumer inflation rose as did producer prices. House prices were up significantly over
the year, as were private rentals, while net mortgage lending rose. Latest retail sales
data showed a decrease in volume.
In Cornwall
Numbers claiming benefits showed marginal changes though both Universal Credit
and Claimant Count numbers moved up slightly. In February1 there were 44,374
Universal Credit claimants in Cornwall. 39% were in work with 25% ‘Searching for
work’. The total is 78% above the March 2020 figure. Claimant count figures for
February show there were 11,530 claimants in Cornwall, up on the 11,400 figure for
January.
The latest Alternative Claimant Count figure for November 2021 shows there were
11,486 claimants, down by 6,799 on the November 2020 total of 18,285. Over the year
the rate2 fell from 5.5% to 3.5%3.
Labour market data for residents shows that over the last year the total aged 16-64
fell4, but with changes in the numbers of economically active – down and economically
inactive - up. Employment numbers were down significantly with an increase in
employees but a decrease in self-employed numbers. The number of those working
full-time fell marginally while the numbers working part-time saw a significant fall. The
number of unemployed decreased.
In March 2022 there were 4,673 job postings in Cornwall. This was up by 22% from
3,837 in January, and also up 109% on the March 2021 figure.
In the year ending September 2021, median house prices in Cornwall equalled
£275,000 compared to £285,000 for England5. In January the annual price rise was
15.8% in Cornwall, compared to a rise of 9.6% across the UK. Total sales in November
1
NB Each month’s figures are provisional and revised a month later.
2
The rate is derived using the 16-64 age group from the MYE.
3
Changes in APS numbers can alter the rates compared to previous versions.
4
Due to the volatility of the data changes in figures from one period to another may not reflect underlying trends.
5
UK figures not available.
Economy Monitoring Monthly Update (EMMU) - March 2022 2Information Classification: PUBLIC at 367 were up 22% on the October total of 3016. The UK sales figure rose by 9% over the same period. there were 2,362 properties for sale with 114 to rent, a total of 2,476 properties. The total was up 24% on 2,002 in March 2021. The latest Cornwall Chamber of Commerce survey takes the data up to Q4 20217. Compared to Q3 2021, there were positive readings8 for 9 of the 12 indicators. Over the year, there were positive readings for 10 of the 12 indicators. The share of businesses running at full capacity was 55%, similar to Q3 2021 (56%) but up on Q4 2020 (40%). The latest data from UK finance gives figures for Cornwall for Q2 2021. Residential mortgage loans stood at £7,330 million, up 1.1% on the Q1 2021 total. SME loans were £1,530 million in Q2 2021, was down 6.5% on the previous quarter. Unsecured loans have raised concerns over the ability of people to deal with debt. In Q4 2019 the figure stood at £292 million and then rose in Q1 2020 to £299 million. Since then totals have declined and in Q2 2021 stood at £249 million. For the UK A common theme of PMI indicators was that output was recovering following earlier issues with supply chains and labour shortages. Services and Construction sector both saw dramatic growth increases while Manufacturing growth improved. On the jobs front recruitment slackened due to candidate shortages. Regional PMI saw growth across all regions of the UK. The Lloyds Business Barometer recorded a reversal of fortunes as economic uncertainty increased. On the consumer front, UK households saw finances eroded as living costs picked up. Increasing stress was seen as the GfK Consumer Confidence index decreased by a further 5 points to -31. On the output front, in the three months to January 2022, GDP growth was up with increases across all grouts – Production Services and particularly Construction. The labour market continued to recover with a significant rise in pay-rolled employee numbers, though self-employment levels are still below pre-pandemic figures. The employment rate was up and unemployment down. House prices rose 9.6% in the year to January, while private rental prices paid by tenants in the UK rose by 2.3% in the 12 months to February, up on the previous months figure. In the three months to February 2022, retail sales decreased by 2.1% compared with the previous three months. Inflation rose to 6.2% in February and is expected to rise again in the coming months. Producer output prices continued to trend upwards with the index at +10.1%. In February public sector borrowing was £13.1, the second- highest February borrowing since monthly records began, but down on February 2021 6 Sales figures are often adjusted each month so that previous figures are superseded. 7 NB Smaller sample size than usual so take should be taken in interpreting data. 8 A plus reading for ‘had experienced recruitment difficulties is regarded as negative! Economy Monitoring Monthly Update (EMMU) - March 2022 3
Information Classification: PUBLIC figures. Net mortgage borrowing in January was £5.9 billion up from the December total of £4.0 billion. January mortgage approvals for house purchase were 74,000, above the 12-month average up to February 2020 of 66,700. The combined net flow into both deposits and NS&I accounts in December (£7.8 billion) compares to an average monthly net flow of £9.4 billion in the twelve months to December 2021. European Union and International At an EU27 level, comparing figures for January 2022 with January 2021, showed that Construction, Industrial Production and Retail trade all showed increases. Industrial producer prices were up substantially while the inflation rate in January was +6.2%, up from 1.3% a year earlier. The final February composite PMI saw economic growth rebounding and inflation hitting a new high. On the international level, January saw world trade volume momentum and industrial production momentum both up by 3.3%. Economy Monitoring Monthly Update (EMMU) - March 2022 4
Information Classification: PUBLIC Cornwall Data Profile – March Population: 573,299 (MYE 2020). [NOMIS]. Enterprises: 24,635, Workplaces: 28,785, 2021. [UK Business Activity]. House prices: Mean: Q4 2021, £290,900. Median: Q3 2021 £275,000. [Land Registry]. Gross Value Added: Total GVA in 2019 £11,467 million. Ex OOIR = £9,842 million. Per head – 2019 was £20,055. Equal to 68.4% of UK average. Main sectors 2019: Wholesale, retail & motors (14.4%, Construction (11.3%), Health & social work (9.8%). GDP £13,034 million 2019. [ONS]. [All in current basic prices]. Productivity: In 2019, Nominal (smoothed) GVA per filled job was £41,984, 74.1% of the UK average of £56,670. Nominal (smoothed) GVA Per hour was £27.20, 77.4% of UK average. [ONS]. Gross Domestic Product: Total GDP equalled £13.2 bn in 2019, (£12.8 bn in 2018). Isles of Scilly = £70 million in 2019, (£84 million in 2018). [ONS]. Employment (workplace): 235,859 in employment. 174,959 employees, 52,266 self- employed. [Census 2011]. 213,000 employees 2020; 232,000 employed 2020. [BRES]. 243,000 employed YE Sept 2021. [APS, 16+]. Unemployed: 11,700 YE Sept 2021. [APS, 16-64]; Alternative Claimant Count: 11,486, November 2021. [DWP]; Universal credit: 44,374 February. [DWP]. Vacancies: 4,673 job postings, March. [Active Informatics]. Workless households: 26,000, 15.0%, (UK 13.8%); Workless People: 34,000, 10.4%, (UK 9.5%) 2020 [APS]. Employee earnings: Total workplace gross annual median earning, 2021 £20,628 (79% of the UK average. (Full-time £25,597, Part-time £11,313). [ASHE, Provisional]. Total resident gross annual earnings in 2021 equalled £21,214, 79% of the UK average. CIoS and Cornwall. [Annual Survey of Hours and Earnings]. Self-employed earnings (median): £14,000 for 2018-19. [UK £15,000]. [HMRC]. Gross Disposable Household Income: £18,846, 87.9% of UK average, 2019. [ONS]. Qualifications: 25% with Level 4 and above, 22.4% with no qualifications. [Census 2011, 16+]. NVQ4+ 33.9% (UK 43.0%); No qualifications 5.3% (UK 6.6%), 2020. [APS, 16-64]. Economy Monitoring Monthly Update (EMMU) - March 2022 5
Information Classification: PUBLIC
Data Summary
Cornwall [CIoS in brackets]
Alternative Claimant count
• November 2021 11,486 [11,514] claimants, down by 118 on the October total
of 11,604 [11,621], and down by 6,799 on the November 2020 total of 18,285,
[18,321].
Universal credit
• February9 44,374 [44,451] UC claimants, up 1.3% on the January figure. [78%
above 24,876 in March 2020].
• February – searching for work 10,914 (25% of total).
• February – working 17,300 (39%).
Claimant Count
• February 11,530 [11,565], up 1.1% on the January total of 11,400. [31% above
the March 2020 figure].
Labour market - resident based [Year ending September 2021]10 [Previous year].
• 16-64 = 323,700. [329,200] ↓
• Economically active = 254,000, [261,200] ↓
• Economically inactive = 69,700, [68,000] ↑
• Employed = 242,400, [252,000] ↓
• Employees 201,000, [197,700] ↑ Self-employed 41,400, [53,400]11 ↓
• Full-time = 168,700, [168,200] ↑; Part-time = 73,300, [83,300] ↓
• Unemployed = 11,700, [9,200] ↑
Labour market - workplace based [Year ending September 2021, 16+]
• Working = 243,000, [246,000] ↓
• Self-employed = 47,000, [58,200] ↓
• Employees =191,900, [175,400] ↑
• Flexible = 4,100, [12,400] ↓
Defence employment
• 2021 - 3,680 [3,260 (89%) military and 420 (11%) civilians].
9
NB Each month’s figures are provisional and revised a month later.
10
Figures cover a year and are produced quarterly; all figures for age group 16-64.
11
Numbers may not sum to all those employed.
Economy Monitoring Monthly Update (EMMU) - March 2022 6Information Classification: PUBLIC
Vacancies (job postings)
• March = 4,673 [4,691]. Up 22% on February = 3,837; and up 109% on March
2021 = 2,899
Housing
• Prices (Mean): Q4 2021, £290,900. [£254,900 in Q4 2020].
• Prices (Mean): January = £302,121, +15.8%. [January 2021 = 10.9%].
• Prices (Median) Q3 2021, £275,000. [£237,500 in Q3 2020].
• Sales: November 2021 = 367, up 22% on October = 301. [Down 64% on
November 2020 = 1,015].
• Properties available: March – there were 2,362 properties for sale with 114 to
rent, a total of 2,476 properties. [Up 24% on 2,002 in March 2021].
Commercial property
• Properties available: March – 260 (Retail 38%, Leisure/hospitality 28%). 124
commercial properties for letting with 136 for purchase.
Chamber of Commerce Q4 2021
• Compared to Q3 2021, there were positive readings12 for 9 of the 12 indicators.
• Compared to Q4 2020, there were positive readings for 10 of the 12 indicators.
• 55% of businesses were operating at full capacity, [Q4 2020 40%].
Finance
Loans Q2 2021, compared to Q1 2021.
• Residential mortgage loans £7,330 million up 1.1%.
• SME loans £1,530 million, down 6.5%.
• Personal loans £249 million, down 1.1%.
12
A plus reading for ‘had experienced recruitment difficulties is regarded as negative!
Economy Monitoring Monthly Update (EMMU) - March 2022 7Information Classification: PUBLIC
United Kingdom
Business Surveys and barometers
• UK Manufacturing PMI: February - Manufacturing growth improves as supply
chain pressures show further signs of easing. ↑
• UK services PMI: February – Growth of activity rebounds to eight-month high.
↑
• UK Construction PMI: February – Fastest rise in construction output for eight
months. ↑
• Jobs: February – Candidate shortages drive softer increase in recruitment
activity in February. ↑
• NatWest IHS Markit - UK Regional PMI: February – Business activity picks ups
across the UK as Omicron wave recedes. ↑
• Lloyds Business Barometer: March – Confidence drops as economic
uncertainty increases. ↓
Consumer Surveys and barometers
• Household Finance Index: Q4 21 - rising living costs erode household finances
at fastest pace since the start of the pandemic. ↓
• Gfk’s Consumer confidence index: March: Down 5 points to -31. ↓
Output
• GDP growth 3 months to January at 1.1%, up on the previous 3 months13. ↑
• Index of Production – 3 months to January shows 0.4% increase on previous 3
months. ↑
• Output in the Construction sector – 3 months to January shows 3.0% increase
on previous 3 months. ↑
• The seasonally adjusted Index of Services – 3 months to January shows 1.0%
increase on previous 3 months. ↑
• New car output: UK car production falls -41.3% in February to 61,657 units as
global chip shortage persists. ↓
• Trade: The total trade in goods and services deficit, excluding precious metals,
widened by £8.6 billion to £21.3 billion in the three months to January 2022.
↑
13
3 months to August.
Economy Monitoring Monthly Update (EMMU) - March 2022 8Information Classification: PUBLIC
Balance of Payments
• The underlying UK current account deficit excluding precious metals narrowed
to £11.4 billion, or 1.9% of gross domestic product (GDP) in Quarter 4 (Oct to
Dec) 2021, from £26.1 billion in the previous quarter.
Labour market - Main points
• Employment rate (75.6%). ↑
• Unemployment rate (3.9%). ↓
• Our most timely estimate of pay-rolled employees shows another monthly
increase (up 275,000) in February 2022 to a record 29.7 million. ↑
• The number of job vacancies in December 2021 to February 2022 rose to a new
record of 1,318,000. This is an increase of 105,000 from last quarter, with half
of the industry sectors showing record highs. However, the rate of growth in
vacancies continued to slow down.
• Growth in average total pay (including bonuses) was 4.8%, and growth in
regular pay (excluding bonuses) was 3.8% among employees in November 2021
to January 2022. In real terms (adjusted for inflation), growth in total pay was
0.1% and regular pay fell on the year at negative 1.0%. ↑
Housing
• House prices – up 9.6% in year to January. ↑
• House prices (median) – £285,000, year ending September 2021. [England].
• Private rental prices paid by tenants in the UK rose by 2.3% in the 12 months
to February 2022, up from 2.1% in the 12 months to January 2022. ↑
• UK sales – November = 45,800, up 8.9% on October and down 52% on
November 2020. ↓
Consumer, retail and prices
• Consumer Trends – Q4 (Oct to Dec) 2021. Household spending growth
(adjusted for inflation) increased by 0.5% in Quarter 4 (Oct to Dec) 2021 when
compared with Quarter 3 (July to Sept) 2021. Household spending increased by
8.1% in Quarter 4 2021 when compared with Quarter 4 2020. ↑
• Retail – 3 months to February 2022 2.1% decrease in volume on previous 3
months. ↓
• CPI annual inflation: February 2022 +6.2%, up compared to January. ↑
• Producer prices: February 2022 shows 10.1% annual increase. ↑
• Services produce prices: Q4 2021 shows 3.6% annual increase. ↑
Economy Monitoring Monthly Update (EMMU) - March 2022 9Information Classification: PUBLIC
Finance
• Public sector net borrowing excluding public sector banks (PSNB ex) was £13.1
billion in February 2022, the second-highest February borrowing since monthly
records began in 1993. This was £2.4 billion less than in February 2021 but still
£12.8 billion more than in February 2020, before the coronavirus (COVID19)
pandemic.
• Mortgage borrowing - Net borrowing was £5.9 billion in January, up from £4.0
billion in December.
• Approvals for house purchases - an indicator of future borrowing, rose to
74,000 in January, above the 12-month average up to February 2020 of 66,700
and the highest since July 2021 (75,900).
• Consumer credit - Individuals borrowed £0.6 billion in consumer credit in
January. This is lower than the average of £1.0 billion in the 12 months up to
February 2020
• Households’ deposits - Households deposited an additional £7.7 billion with
banks and building societies in January. In addition, households deposited £0.1
billion into National Savings and Investment (NS&I) accounts in January, which
are not captured within household deposits with banks and building societies
but can act as a substitute for them. The combined net flow into both deposits
and NS&I accounts in December (£7.8 billion) compares to an average monthly
net flow of £9.4 billion in the twelve months to December 2021.
Economy Monitoring Monthly Update (EMMU) - March 2022 10Information Classification: PUBLIC
European Union
Annual
EU27: January 2022 compared to January 2021
• Retail trade index +8.3%. ↑
• Industrial production +0.4%. ↑
• Construction +4.8%. ↑
• Industrial producer prices +30.3%. ↑
Unemployment: January 2022.
• EU27 unemployment rate 6.2%, down from 7.5% in January 2021. ↓
EU27: Inflation - February 6.2%. [1.3% February 2021]. ↑
Quarterly
• Q4 21 Seasonally adjusted GDP rose by 0.4%. ↑
• Q4 21Employment rose by 0.5%. ↑
• Q4 21 Vacancy rate = 2.6%. ↑
• Q3 21 House prices = +3.1%. ↑
Eurozone
Markit Eurozone Composite PMI® – final data: February - Eurozone growth rebounds
in February as output price inflation hits new survey high. ↑
Global data
Developments in global international trade and industrial production – January
2022
• World trade momentum was 3.3%14.
• World industrial production momentum was 3.3%.
14
Momentum - based on three-month change
Economy Monitoring Monthly Update (EMMU) - March 2022 11Information Classification: PUBLIC Prepared by: Peter Wills Economic Analyst Economic Growth Service 31 March 2022 If you would like this information in another format, please contact: Cornwall Council - Economic Growth Service Email: economicdevelopment@cornwall.gov.uk Telephone: 0300 1234 100 www.cornwall.gov.uk Economy Monitoring Monthly Update (EMMU) - March 2022 12
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