UK must get over its 'obsession with recession' to allow proper assessment of its economic health, warns top official

By This Is Money Reporter

|

The media's 'obsession with recession' is preventing real debate over the performance of the UK economy, a the chief economist of the Office for National Statistics has said.

Joe Grice criticised the 'unhelpful' concentration on whether or not the UK is in recession after ONS construction figures yesterday indicated that the double-dip might never have happened.

Revised data for the construction industry showed it did not fare quite as badly in the first quarter of 2012 as previously believed - declining by 5 per cent rather than 5.4 per cent.

The NIESR said the UK economy had grown by 0.8 per cent in the last three months, adding to suspicions that official figures had overestimated the downturn.

The NIESR said the UK economy had grown by 0.8 per cent in the last three months, adding to suspicions that official figures had overestimated the downturn.

That has heightened speculation that when the final figures are produced in June, they will show the reported recession from the last part of 2011 to the middle of 2012 - following on from the deep recession of 2008 to 2009 - did not technically occur.

A recession is defined as two consecutive periods of negative growth and the change in gross domestic product in each of the first two quarters of the period was only a marginal fall of 0.1 per cent.

Ironically, political debate until recently was dominated by speculation that the UK was set to slip into an unprecedented triple-dip recession - a prospect shattered by unexpectedly high growth of 0.3 per cent for the first quarter.

Mr Grice said the ONS had to 'stay out of the politics' but appealed for a more sensible debate.
'As an Office we think the public debate has been quite counter-productive,' he told BBC Radio 4's Today.

Building optimism: latest construction data has made economists question official growth data.

Building optimism: latest construction data has made economists question official growth data.

'We think it's much more important to look at what's been happening to the broad trends in the economy over a period of time.

'Over the last two or three years we have grown on average by around about 0.5 per cent a year, quite a bumpy path but clearly very different to what was happening before 2008.

'That all seems to us to be much more important and much more salient in terms of having a sensible debate than really whether one particular quarter is up a smidgen, down a smidgen.

'We stay out of the politics. But we think the public debate would benefit from spending more time looking at what's really happened to those trends over time than worrying about particular small changes in particular quarters.'

Mr Grice insisted the ONS did not 'get the sums wrong', explaining that only around half the information necessary to give a definitive picture of quarterly GDP was available at the time initial figures were produced.

The change in the construction figures did not necessarily mean the overall picture would now show there had been no double dip, he said, as it was only one factor in the calculation.

 

The comments below have not been moderated.

It's all about HOW you feel!!! If YOU THINK the world is going to implode you won't spend.. Cos your faith has gone!!! But if you think you have a future its business as normal and you do all the things you always used to. I know, I for one feel insecure about the future so have changed my buying habits. But when your at rock bottom there is only one place and that's up!!!!

Click to rate     Rating   3

No one of any intelligence needs to be told that we're in recession. We can see for ourselves. To try and 'talk things up' in the hope that everyone will believe you if you talk loud enough is crazy socialist nonsense.

Click to rate     Rating   1

ONS: stop obsessing about recession! PUBLIC: But weren't you the ones who got the data wrong causing the media to rave about double dips? ONS: Well, not exactly. Blah, blah, blah. PUBLIC: My head hurts.

Click to rate     Rating   2

Until we get the millions back into employment this country will continue to be in trouble.

Click to rate     Rating   6

Irrespective of what name you choose to give it, the UK's economy is in deep trouble: we have mass unemployment and a massive increasing deficit.

Click to rate     Rating   5

How can any organisation release information that impacts a country and its peoples welfare and argue the data released was based upon half the information necessary to produce an accurate result. Why not release the information when you know it to be right? The ONS is grossly incompetent on this point and it is no wonder that people don't believe a word the statistics say! The fact of the matter is that most of us are feeling the pinch and we all know that the UK and European economies are not as they should be and this is due to poor government leadership across the board.

Click to rate     Rating   9

Would these 'expect advisors' be on 100,000+ paid for by the taxpayer, saying we should be more positive? Here's a tip look out of a window, take a walk down a high street, name two busy construction firms.

Click to rate     Rating   6

Statistics damn lies and statistics. We dont need statistics to know we are living the austerity dream. Perhaps if the numbers were more timely amd credible we might believe them. No, we wouldnt.

Click to rate     Rating   3

What's great about the term 'recession' is that it's so flexible! Sometimes it's happening, sometimes it's not... never mind what you see around you. Hey, no growth feels a whole lot better than negative growth, right? And anyway, if things are not good in your back yard, just make sure that you ONLY invest overseas!... or just focus on hedging. Everyone has a portfolio, right? And remember, don't be negative! Everything will stabilise when the little people realise that we are in this mess because they were overpaid and were greedy enough to think they should own their own homes. They need to understand "those jobs are never coming back" and "lending has changed forever". It's the new normal!

Click to rate     Rating   2

tigerboy , east yorkshire, Algeria, 11/5/2013 17:01. I didnt say that any of them were any good but facts are the facts. Don't like it then do something about it at the next election.

Click to rate     Rating   1

The views expressed in the contents above are those of our users and do not necessarily reflect the views of MailOnline.

You have 1000 characters left.
Libellous and abusive comments are not allowed. Please read our House Rules.
For information about privacy and cookies please read our Privacy Policy.
Terms