Canada's Job Picture Stays "Lukewarm", Says Rosenberg Research
Canada's May Labour Force Survey (LFS) showed an 8,800 gain, beating the consensus decline of 10,000
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Canada's Job Picture Stays "Lukewarm", Says Rosenberg Research
Canada's May Labour Force Survey (LFS) showed an 8,800 gain, beating the consensus decline of 10,000
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5 days ago
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ONS admits inflation blunder
Britain's beleaguered statistics agency has admitted that it overstated April's inflation figures after uncovering errors in its data. On Thursday, the Office for National Statistics (ONS) confirmed annual inflation hit 3.4pc last month, compared to its previous calculation of 3.5pc. Official blamed the blunder on faulty car tax data provided by the Government, as Whitehall provided the relevant numbers on Vehicle Excise Duty (VED). However, the mishap will no doubt pile pressure on the ONS, which has been repeatedly criticised over the past year for publishing flawed data about the UK jobs market. As well as lowing the headline rate of inflation, Thursday's correction will also take 0.1 percentage points off the retail price index, reducing that measure to 4.4pc. This embedded content is not available in your region. This will be of significance for Rachel Reeves, the Chancellor, as a significant chunk of the Government's debt is linked to the measure. Some economists will also breathe a sigh of relief after last month's price rises were higher than they expected. It comes at a critical time for the economy as the Bank seeks to work out how far and how fast to cut interest rates. Threadneedle Street's policymakers, led by Governor Andrew Bailey, try to set borrowing costs to keep inflation at or around 2pc, with their decisions are guided by data from the ONS on price rises and unemployment. However, Mr Bailey told MPs this week that the Bank of England is now now using a much broader range of data after recent shortcomings at the ONS, which has struggled with a poor response rate post-Covid. 'It is a work in progress,' said Mr Bailey. 'I don't want to take away from the fact that the ONS is working very hard at this. 'There is a very severe health warning on every release they make. Until they introduce what they call the new transformed labour force survey (LFS), which will not be until next year, we should still regard the LFS with a great deal of caution and a big health warning.' The latest admission from the ONS startled analysts and moved financial markets, with potential repercussions for household and business finances. Bruna Skarica, at Wall Street bank Morgan Stanley, noted the jump was far larger than anything she had thought possible. It also fed straight into forecasts for the Bank of England's interest rate cuts. 'Today's data raises doubts on expectations for two further cuts this year,' said Gabriella Dickens, economist at AXA Investment Managers. Critically for borrowers, those forecasts have already led to trades trimming their bets for a summer rate cut, meaning borrowing costs are likely to remain higher for longer. The ONS was approached for comment. Sign in to access your portfolio
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Britons risk being forced to take part in ‘jobs census'
Britons could be forced to give details of their jobs, earnings and health status to officials as a slump in responses to surveys undermines Whitehall's ability to judge the state of the economy. Professor Denise Lievesley, who ran a major review of statistics for the Government, said the proposal could ensure that Britain's economic data – which is critical to making decisions on policies including interest rates – could be relied upon. Members of the public can currently be fined £1,000 if they fail to complete the census, while businesses which refuse to complete surveys for the Office for National Statistics can be taken to court and charged £2,500. However, there is no such incentive to fill in the Labour Force Survey (LFS). A plunge in response rates to the vital questionnaire since the pandemic has left the Treasury, the Bank of England and City economists struggling to gauge the strength of the jobs market, the risks to inflation and the health of the wider economy. The census was completed by 97pc of households in 2021. By contrast only around one fifth of those approached for the jobs market survey responded, a share which has fallen by roughly half since the pandemic struck. Professor Lievesley said in an interview with Bloomberg that compelling Britons to respond was 'a last resort option', but that 'we may have got to that stage'. She added: 'It's not that we actually use the mandation to impact on individuals but I think in the case of the LFS it would help the survey interviewers and I think it helps the enumerators in the census. 'It raises the profile that this is important. If they're asked, 'do we have to do this?' Well, I'm sorry, but I'm afraid you do. I think it works mainly through the confidence of the interviewers.' It is understood that the UK Statistics Authority and the Cabinet Office have been studying ways to compel people to respond to the survey, but have not yet concluded what consequences there could be for households which fail to fill in the questionnaire. Such a step would require legislation, rather than being decided by statisticians. The ONS has sought ways to improve the number of responses to the survey, including by sending it to more households. The agency has also trialled offering respondents a £20 voucher, instead of the usual £10 incentive, which was already up from £5 before Covid. It is also introducing a new online version of the survey next year. Officials at the Bank of England have attempted to get around the issue by seeking other sources of data, including by designing their own surveys for an alternative perspective on the economy. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
