To withstand future recessions, the UK needs radical supply side reform
- On January 18, 2023
- By GrowthInvest Marketing
When academics write essays, they begin with an abstract that captures the causes, effects and outcomes of the economic policy change they are examining.
Boosting the supply side has a pretty simple argument. Either increasing the volume or productivity of resources used to produce things makes a country richer. That’s it.
Let’s take a look at one of those resources: workers.
Living standards are drawing close attention at the moment because they’re tanking.
One thing is true. Countries can get away with anaemic real wage growth when inflation is low. When it enters the double-digits, problems spring up.
That real income erosion has sparked a wave of strikes disrupting the UK economy.
What’s essentially happened over the past 18 months is that the rate of increase in energy prices has far outstripped the rate of increase in the UK’s exports. We’re a net importer of energy, so those higher costs have swept through the economy.
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