My Danske Bank colleague Anders Vestergård Fischer had a fun idea today – he wanted to “translate” the latest UK labour market numbers into something an US audience could understand.
Here is the result of Anders’ back of an envelop calculations – if the US non-farm payrolls were growing as fast as the latest UK employment growth (Q3 2013) then the US economy would be adding 380-400k jobs per month! We haven’t seen job growth like that in the US since the late 1990s. Over the past three months US payrolls have growing around 190k per month.
So what are the explanations for the the UK labour market improvement? The negative spin: Horrible British productive growth. The positive spin: A very healthy combination of monetary easing and fiscal consolidation.