At times I am a hopelessly confused burd. I try my best. I read the business pages and economic commentaries regularly but to little avail.
I know, for example, that inflation persists at a stubbornly high level and that this is probably not a good thing. It might cause the Bank of England to raise the base interest rate and while this would be a good thing for savers, it will create problems for mortgage payers.
Unemployment in Scotland is significantly above the UK average. This is definitely not a good thing but does it tell us anything about the current state of our economy or is it simply a lag feature of the recession which everyone who seems to know about these things, has declared is over.
House prices rose earlier this year, now they have stagnated and some say they have fallen. No one is sure if this is a good or a bad thing.
Is it little wonder I, and no doubt many others, are uncertain as to the state of our economic wellbeing? To counter this, I have developed and adopted an alternative set of bellweather measures. They aren’t scientific but they are rooted in real life and not just in the minds and reports of economic pointy heads. Perhaps most importantly, they have yet to let me down in determining our economic state.
1. House sales
I live in what I fondly call tax credit territory (though not for much longer thanks to the ConDem government). Not poor enough to be deserving of special measures or regeneration status but not a particularly wealthy community either. Not too rough, not too polished. Which makes it a ripe first time buyer or step up the ladder housing market. One of my bellweathers therefore is to watch what goes up for sale and how quickly it moves. When the financial crisis hit, some very nice houses on the market languished, for more than a year in at least a few cases. Last year only a sprinkling of new properties went on sale and they took months to shift. This Spring, two houses round the corner were put on the market and sold in a week. For sale signs appeared like weeds in gardens all around and over the summer sales were steady. Until the end of July. Since then the flood of sales has slowed to a trickle. I don’t think it’s a good sign.
2. Local shop closures
My bus journey to work takes me past three corridors of small retail outlets, mostly populated by local independent traders. Between September 2008 and summer 2009 the rate of closures was alarming. Then it slowed to a standstill and eventually most of the shops were filled. Over the summer there has been a whole host of new closures. Worryingly, it’s much more established businesses that have been disappearing. And some of the new ones didn’t even make a year. I don’t think it’s a good sign.
3. Taxi drivers…
Edinburgh taxi drivers used to be fairly chirpy creatures. And then their world crashed down about their ears when the banks, financial institutions and lawyers halted their contract work. 2009 became the year of the moaning cabbie, with drivers having to work more hours, spend less time on the golf course and rent out their pride and joy. Tough times. Earlier this year, business seemed to be picking up. Contracts were back in fashion, though the Friday night after work throng was definitely still a subdued market as folk tightened their belts. Those who have been around the block reckoned it was the quietest festival time ever and since the end of August trade has totally dropped off. They fear a long, hard winter. I don’t think it’s a good sign.
The burd has always marvelled at Edinburgh’s insatiable appetite for hairdressers. Every community boasts at least one, if not several along its main street. A business expiring provides an opportunity for another shiny salon to spring up. The financial crash did not dent the trend. But this summer has been different. Not only have fewer new salons been appearing on my three shop corridors to work, but some of the businesses that have folded have been hairdressers and barbers. And pretty long established ones too. I don’t think it’s a good sign.
5. Chain store sales
This summer John Lewis has had two price reduction events “in response to a competitor’s event” and its usual summer clearance sale. Sales volume in Scottish stores appears to have shrunk. And now apparently even Primark is predicting depressed sales. These retailers serve largely different consumer bases, yet both appear to be showing signs of struggle. I don’t think it’s a good sign.
Okay, so my economic bellweather system won’t ever win me the Nobel prize and there won’t be a curve named after it anytime soon. But added together, they tell me a lot about what is happening in the real economy all around me. None of the measures are particularly sparky at the moment. And I don’t think that’s a good sign.