Footsie's misplaced wage worries

Article Abstract:

There is concern that a drop in unemployment in the United Kingdom could lead to wage rises that outstrip productivity, and this tends to depress stock prices. Real wages have not risen, and this may be partly because the supply of workers has increased, and people entered employment were not always previously classed as unemployed. Some employees may also work harder than necessary in exchange for job security, and this helps stabilize wages. Inflation may still result from higher prices rather than wages. The link between increased demand for labor and rises in real wages is not clear cut.

Prices, Wages, Economic aspects

---

Waging a phoney war on inflation

Article Abstract:

The Bank of England is likely to call for higher interest rates as a response to UK wage inflation of 5.5% in the private sector and 5% in the economy as a whole. The data could exaggerate the problem since it is affected by bonuses at the end of 1996, so average earnings growth could fall. There is a debate as to when wage inflation will become a problem, but with unemployment falling rapidly, some analysts argue that further falls could be inflationary. Others argue that greater labor flexibility will allow unemployment to drop more without inflationary pressure.

Bank of England, Economic policy

---

Similar abstracts:

• Abstracts: Union des Assurances de Paris. Taking a limited bet on Lloyd's. A problem shared...
• Abstracts: How Brown's magic will hit companies. Whistling in the wind. No tax rises
• Abstracts: Banking's identity crisis: the need for branding. Harnessing customer information. No guarantees in database marketing
• Abstracts: Electra's unexpected reprieve. Venture capitalist to prune portfolio. Lowly enterprise trust faces shake-up
• Abstracts: Bosses are supposed to produce beans. Beware conventional measures of success. Bosses who just keep going

This website is not affiliated with document authors or copyright owners. This page is provided for informational purposes only. Unintentional errors are possible.