So let’s put aside cancer and lower life expectancy as Johnson prefers and look at wage growth.
So wage growth is happening because of the lack of supply of Labour.
Easy innit - supply and demand.
Strangle the supply of Labour and employers will raise wages to try attract the employees they need.
But what happens then? What are we actually seeing in the economy?
Inflation- that old enemy that every government hates because it plays havoc with their voters cost if living. The housing crises will be exacerbated because the cost of borrowing will rise.
After the horror that covid inflicted on businesses they will find loans to help them over a sticky period will be more expensive making their businesses less profitable or they increase their prices.
But we haven5 just got demand inflation have we? We’ve got price led inflation as well from the rise in fuel and other commodities as the world opens up after cover.
So once again the U.K. is being hit with a double whammy not just demand led but price led inflation on top of it.
The natural outcome of all this steep rise in the cost of living will be that people demand higher salaries to keep up or see their standard of living fall. We then get into that old enemy of the wage spiral, cost of living rise=higher wages = businesses put up prices to pay for wage rise ad nauseum.
What does Johnson do?
Crow about that oh so clever rise in wages. With inflation at
Well, that was a farce.........
Virtual patient in Virtual ward ??
