As a nation we have an opportunity. We have strong employment and record vacancies.
If we choose we can invest in training, automation and digital, making what we do much more efficient. The upshot would be simple. We would create a more highly skilled and productive economy. We will be able to pay ourselves more to get better output. It’s a great opportunity and an open goal.
An opportunity exists right now on the railways. Post Covid commuting has changed. The number of rail trips made has massively reduced. There is a huge need to modernise and drive a more efficient service – which will help support the workforce years into the future.
Across the economy the alternative is extremely dangerous.
Inflation is spiking globally. It has been caused by global factors including suppressed production during Covid and a spike in demand as lockdowns lifted. This has worsened as ongoing Covid in China stymies trade, compounded by the international community rightly imposing sanctions on Putin’s regime to cut his ability to fund their brutal war.
This inflation will have a severe impact globally and, just as it always does, it will have its worst effect on those on fixed incomes and some of the least well off in society. The Government was right to bring forward a huge programme of support which can’t stop the impact but can help those most affected.
Most experts believe that we could be through the worst of the inflation spike by the end of next year. There are signs it may begin to tail off this autumn.
We can however be the authors of a long term hard-to-fix problem if a spiral of inflationary wage settlements bakes inflation into our system….it stops being a problem of global supply and starts being a problem of overcooked domestic demand. We have been there before.
The rail strikers causing havoc this week to children whose education has already been disrupted and just want to get to exams, to key workers just wanting to get to work, to many just wanting to get on with their lives, are choosing the wrong path. It will be self defeating for them. It is also a huge risk for our country.