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First month of 2026 shows upturn for Britain's economy and $31 billion monthly budget surplus at Treasury. This is good news for Reeves and Keir Starmer as they face Manchester by election on Feb 24, 2026, first of local elections after the Mandelson episode. Unemployment is at 5.3% and inflation has fallen to 3% for the British economy in January 2026.

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David Card and Alan Krueger with a study on New Jersey and Philadelphia restaurant workers in 1994 and their subsequent studies on minimum wage increases show no negative effects on unemployment of increasing the minimum wage- More discussion on this topic as Minimum wage increases to $22 an hour in 2026 in NY and California. Indrajit Dube of U Massachusetts says it all depends on how far one goes in increasing the minimum wage. At some point maybe $30 a week it could lead to restaurants deciding not to hire more workers. At 45 hours a week for 48 weeks an employe in the fast food industry at $22 an hour would make $47,520, and at $30 would make $64,800. The poverty level is set at $33,000. The problem with these figures is that the cost of housing is so high and automobile costs have risen very fast in the last 5 years. Housing in New York and Los Angeles is very costly compared to states in the midwest, in the south, and other states. Card's and Krueger's, Dube's studies show that retention is higher employees are more motivated leading to higher restaurant and fast food sales, happier customers, that could lead to more employment not less. Some of this is intuitive and one does not need an economist to tell one that. When compared to Britain's economic and social philosopher Adam Smith much of the accepted wisdom of what Smith said is selective taking what one wants and leaving out the rest, as Lahart shows here about minimum wage. As Adam Smith was  a keen observer of the social sentiments of society which he considered very important for British society, and for British civilization to flourish. For this reason he supported higher wages and the betterment of the lower classes, as Britain's example to the world. Card received a Nobel prize in 2021 for his experiments including his paper on minimum wage in New Jersey and Philadelphia. ...

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Unemployment drops to 5% in Britain for the three months to January 2021.

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Experts say there are only a couple of hundred high-integrity welders in Britain. Many manufacuring jobs go unfilled because of lack of skilled workers. Britain is trying to close this gap and reduce unemployment for young people by increasing apprenticeships in industry and worker training. The UK government allocated 1.57 billion pounds on worker training programs in 2013. Britain had 868,000 people in apprenticeship programs in 2013. EEF, a British trade group, says 80% of manufacturers have difficulty finding skilled workers with technical skills. Britain has done very poorly in the area of worker skills training according to the OECD. About 2.74 million new manufacturing jobs are expected to be created in Britain by 2020, of this 1.86 million will require engineering skills, according to EEF. A lot more needs to be done, as companies need to double the number of apprenticeships to meet expected needs.

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This report in WSJ shows how European countries are maintaining salaries of employees who would otherwise be laid off. Governments have setup programs in France, Britain, Germany and other countries to provide employers with the money for 80-84% of salaries up to 2500 pounds ($3165) in Britain and 5330 euros a month in France. As a result 1 worker out of three in the private sector in France for subsidy applications for 6.9 million workers are already received. For the German program 2.4 million workers will get this benefit. About 1 million companies in Europe retain employees with this program of governments simply sending out the salaries with funds directly to households. This helps to keep out the stress for families, particularly families with children. It is as if the employees are not really laid off but asked to stay at home for manufacturing facilities and work from home in shorter hours where work can be done remotely.  Money is quickly deposited into the bank account of employees in these countries, though it is slower in Italy and Spain. It is as if the European approach is put the whole economy on pause for 2 months and restart it almost like before with only a small dent in employment once the coronavirus is pushed out with lockdowns and strict control actions. This will cap German unemployment at 5.9% compared with 5% last year, only a modest increase. The cost is not that much considering what it accomplishes. 10 billion euros is the cost in Germany where the state fund for this has 26 billion euros. 10 billion pounds in Britain. And 20 billion euros in France.  The U.S. adopts a similar approach also through its $349 billion program which provides loans to companies with less than 500 employees to meet payroll for 8 weeks and pay some overhead. Loans are forgiven based on job retention and employees on the payroll and only if the employees are retained. Another program is for companies larger than this. And a third program targets entire industries such as airlines, aerospace, and companies in other industries so that they do not have to layoff employees. U.S. unemployment insurance is modified to work along similar lines maintaining incomes of employees laid off because of the pandemic. Another program sends checks directly of $1200 to households with lower incomes to help them and to help people at poverty level or without jobs. The thrust of both the European and American efforts is the same, lose as few jobs as possible, keep people's incomes steady, and do this in a way that the economy can pick up quickly to the former level in as short a time as possible. Compared to Europe U.S. unemployment will be higher predicted at 9.8% with the expected rebound lowering the unemployment in 2021. ...

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The mood in the UK is becoming less receptive to foreigners as job losses mount and the economy declines. For a long period under Labor administrations openness to foreign investment served Britain well. From 2004 to 2007 foreign investment accounted for 7.4% of UK's GDP compared with 1.4% in the USA and 1.6% in Germany. Immigration tripled under Labor governments. Now the mood is shifting as job losses mount. Unemployment which was 4.7% in 2005, was 6.3% in the 4th quarter of 2008. Estimates by IHS Global Insight, a forecasting firm, shows that unemployment could reach 10.5% by early 2011. Government figures indicate that the number of British workers in the country went down by 234,000 to 27 million in the last quarter of 2008. The number of foreign workers went up by 175,000 to 2.4 million. About 104,000 jobs were lost in the 4th quarter of 2008. During the period from 1995 to today manufacturing accounts for a smaller portion of the British economy, going from 21% to 14%. In this new climate French owner Total SA faced strikes at it Immingham oil refinery for not hiring British workers for an expansion at the refinery. It offered to set aside 102 of 200 temporary construction jobs for British workers. And public anger is evident about things that earlier would have aroused passing interest. One example was for a plan to sell part of the British postal service with the Dutch or the Danish as buyers. Another an award by the government to the Japanese of acontract to build and operate a fleet of high speed trains. And immigration is emerging as the third biggest ocncern of in the country, according to a survey by Ipsos MORI, after the economy and crime, the fourth being unemployment. Actually immigration and unemployment are strongly related, and both are related to the economy, all issues related to the steep downturn, especially to the collapse of the financial industry in London....

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Gerald Seib of the WSJ says president Biden is coming back with new actions to revive the Democratic agenda after a challenging period in the first year. Yesterday's first formal press conference of 2022 gave Biden an opportunity to respond. Why the WSJ, NYT, did not cover on their online edition front pages president Biden's first formal press conference on Jan. 19, after 1 year of the Biden administration, will remain a mystery. With the American press acting this way it did not take much for Germany's DW.com to run the story with the title "Biden's first year weighed down by disappointment," with a thoughtful Biden at the press conference replaced by a picture of Biden staring downwards.  This is only the first year of the Biden administration. Actions are planned to ease the supply chain situation and bottlenecks at ports. Much is made of inflation, Afghanistan, Ukraine, by Republicans assailing the Biden record. President Biden responded to this by asking at the press conference what Republicans are for. On Afghanistan Biden held firm on not investing billions of dollars every week when there is so much need in America and the rest of the world at this time of the pandemic after a failed adventure for 20 years in "a graveyard for empires."  Biden pointed to the bright spots in 2022- vaccination and testing achievements in the face of anti-vax sentiment with 200 million vaccinated, the job creation in the economy with unemployment way down and wage increases by employers, and the $1 trillion in infrastructure spending tackling much needed projects state by state with immediate impact. Rarely has a president faced so many challenges in the first year as Biden pointed out- vaccination drive in the face of the Delta variant and anti-vax sentiment, the Ukraine crisis with a president Truman period like event of the Berlin Wall coming up just potentially around the corner, and efforts to tackle problems left untackled for a generation in infrastructure, for working families and climate change. Scoring on infrastructure spending, one of the three, with the other two for working families and climate change to be tackled in the remaining three years and beyond.  Biden also told the American audience at the press conference that he was reminded of what his father used to tell him- that if all goals are equally important, nothing is important. In saying this he said help for working families through child tax credit, child care assistance, community college education funding, health care costs, climate change investment were priorities for his administration that would be tackled step by step. And he pointed out from the outset of the conference that only one or two senators were blocking the party's plan for children and working families. All 48 other senators were united in the Democratic party behind his plans for workers and families. As were 5 Republican senators who he said he would not disclose because of confidentiality. In that sense president Biden already has the majority he needs in Congress. This is not happening because of the peculiar situation of the 2016 and 2020 elections in the US and also in Europe- the historical problem of administrations of Democrats in US, Social Democrats in Germany, and Labor in Britain having give up on their working class families and middle class roots. Tech revolution and internet has further complicated the situation with economic changes, tech companies not paying taxes normally due, and tech workers shifting to Democrats yet living in a world distant from working class families fracturing social cohesion. This is changing in Germany with Scholz in Germany with the help of the Greens determined to restore the dignity of working class families, for Biden with a similar coalition, and a process underway in Britain as Labor returns to its roots. In essence Biden was saying- the process of unwinding decades of unwise policy that hurt America as a nation and leader of the free world would take time, requiring a patient step by step approach. To bring America closer to its own roots and Jefferson's immortal words of "all men are created equal and endowed by their Creator with certain unalienable Rights, and among these are Life, Liberty, and the pursuit of Happiness." Jefferson went on to say in the Declaration that when government becomes destructive of these ends it is the Right of the People to alter it.   ...

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What Krugman makes of the $1.089 trillion dollar U.S. deficit for fiscal year ending in Sept. 2012. He points out that the U.S. can have a stable to declining debt to GDP ratio with $400 billion debt. He cites the Clinton years (1992-2000) when the debt to GDP ratio declined from 49% to 33% with steady growth. What about the remaining $600 billion. He attributes this mostly to temporary factors which are reversible as growth picks up. Of this remaining excess deficit he says $400 billion is from lower tax payments to Treasury because of the 2008 economic crisis and the recession that followed. This includes the payroll tax cut which is also temporary to keep up consumer spending in the recession. The $150 billion is from unemployment insurance, food stamps, and other aid which is also reversed once growth picks up. He places emphasis on restoring economic growth as early as possible and reducing unemployment and using the recession for business to continue to invest in R&D, productivity, and government to preserve the social fabric, invest in education, and provide incentives for growth. S&P Nov. 8 report says the net government debt to GDP ratio is estimated to be over 80% in 2013. It will have to stabilize at current levels for S&P to preserve the U.S. credit rating, says S&P executive Chambers. The higher debt to GDP ratio in 2013 and lower growth rates expected makes the situation different from the lower debt to GDP ratios during the Clinton period. Britain, France and other major industrialized nations with political parties at either end of the political specrum have also chosen to stabilize or reduce debt to GDP ratios rather than take on the risks of them going much higher. The U.S. has the added problem of health care costs out of control with an aging population and about 17.9% of GDP going to healthcare costs in 2010 expected to increase significantly, as Medicare actuaries estimate enrollee numbers jump to 80 million in 2030 from 50 million in 2012. Democrats and Republicans have largely sidestepped this underlying problem in fiscal cliff negotiations....

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David Brooks of the NYT describes the approach taken by British prime minister David Cameron and his Conservative Party government to help the working class poor in Britain, and tackle the social roots of poverty. He says an American adaptation similar to this is badly needed in the Republican Party, with the candidates in the election providing solutions from an old rulebook. Only after Trump's popularity with appeals to less educated older Americans has the Republican leadership responded, with Speaker Ryan helping organize a forum on poverty under the Jack Kemp Foundation- emphasis was placed on education, work, opportunity and accountability for anti-poverty programs in the discussion moderated by Ryan and Senator Tim Scott. Less attention was paid to the other social aspects mentioned here by Brooks, and cited by Cameron when he described the inadequacy of traditional solutions from the right and left of the political spectrum. Cameron outlined the principles of his anti-poverty plans called "Life Chances Strategy," in a speech on Jan. 11, 2016, in north London, with the entrie transcript on the gov.uk website. Cameron acknowledged in the speech that social issues including single parent families, and other social problems such as long term unemployment, can make it harder for some people to use self-reliance and personal responsibility in a growing economy as a way to grasp opportunities. Cameron proposes a combination of economic, social and job growth strategies. His second term plans include 30 hours a week of free childcare for 3 and 4 year olds so both parents can work, parental maternity leave, expansion of Troubled Families Program, in addition to the introduction of National Living Wage, tax cuts, universal credit. In tackling social aspects of the problem Cameron cited the need for development in the early years of childhood, the huge importance of family, social connections and experiences, informal mentors, cultural experiences, broadenend horizons, that enable young people to acquire language skills, character and resilience. Second term projects include expanding reach of high performing schools to deprived areas, emphasis on core English, math, science, history, geography Ebacc skills, a 1 billion pound investment in the National Citizens Service by 2021, a plan to transform housing estates including rebuilding from scratch, additional 1 billion pounds to provide mental health treatment including treatment within 2 weeks in homes and communities. Throughout Cameron's "Life Chances strategy" is aimed at tackling not just the material dimensions of poverty, but also what he describes is broken in Britain- "the paucity of opportunity."...

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In the earlier history of Japan when Japan was still a poor agricultural country, these Japanese left for Brazil to work in the coffee plantations there. Because Japan's aging population meant foreign workers were helpful to ease shortages, especially for the hard and difficult jobs left for for foreigh workers, special work visas were issued to the descendents of these emigrants. Now an estimated 366,000 Brazilians and Peruvians live in Japan. Jiro Kawasaki, an LDP leader and lawmaker, has set up an emergency program of cash payments -$3000 for airfares and $2000 per recipient- to send these South Americans of Japanese descent home, on the condition that they sign papers never to return. Many of these people are agonizing over the decision especially the one that makes return impossible. The idea is to relieve pressure on labor markets as exports have dropped by 46% and unemployment is rising. However Japan has faced labor shortages in thepast, and these people have aJapanese heritage, which makes this policy in immigration averse Japan controversial. In Britain there have been protests as companies hired foreign workers when British workers were unemployed. It appears that this trend is happening even in immigration friendly countries....

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How the Cowley plant stands as a fine example of how foreign investment has helped regenerate the area around Oxford university. BMW has invested more than $560 million in the plant since 2000 and in April 2007 the plant produced its millionth Mini a car based on a contemporary design of the old Morris Mini car. BMW has with its investments contributed about 55,000 jobs and $5 billion to the British economy in 2004 according to Oxford Economic Forecasting. UK received foreign investment that was 37% of of its gross domestic product in 2005, higher than France 28%, germany 18%, and the USA 13%, according to figures from the United Nation Conference for trade and Development. It has helped the British economy as the unemployment rate is lower than most of the EU countries. In the financial services industry a lot of foreign investors from USA, Germany and Switzerland have bought British firms and the financial services industry has thrived with all the international presence and Britian has increased its position as a centre of global financial services....

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U.S. president Trump's 2017 budget is an effort to reshape spending priorities by the Republican party. Apart from Medicare and Social Security all other entitlement programs from the days of Lyndon Johnson's Great Society are subject to cuts. Deep cuts to Medicaid and food stamps, including introducing work requirements. The philosophy behind it is that compassion will now be measured not by how large these programs are but by how much the government can get people "off these programs and back in charge of their lives,"  according to Budget Director Mulvaney.  The cuts are $616 billion to Medicaid and Children's Health programs, $193 billion in cuts to Food Stamps, $143 billion in student loans, $72 billion in disability programs. The overhaul of the Affordable Health Care Act is part of this change. The reallocation would put more money into infrastructure for $200 billion, and in tax cuts, $19 billion in a parental leave program and $29 billion for veterans programs, plus added spending on the military. William Hoagland of the Bipartisan Policy Center, a Republican who worked on budget issues says it will be politically difficult as the cuts to lower income groups come with tax cuts for small businesses and higher income individuals.  Beyond the policy priorities there is an area where both Republicans and Democrats are skeptical of the budget. This is how it impacts the U.S. debt. Under Congressional Budget Office estimates the U.S. debt as a percentage of GDP which rose to about 75% after the Great Recession starting in 2008, is projected to grow to about 85%. In sharp contrast the Trump administration estimates of the Office of Management and Budget are for it to drop to 65% based on rosier estimates of 2% inflation, 3% growth for the decade ahead. Experts say this is unlikely once the Fed raises interest rates and the unemployment rate currently at 4.4% leads to rising inflation, undercutting growth which has remained below 2% for a long period. These concerns are also voiced by Hilsenrath in the WSJ based on the experience of other countries such a Britain that cut corporate taxes without seeing an uptick in economic growth. ...

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Unemployment in the UK reached 8.4% for the three months ending in January 2012, with total unemployed at 2.67 million. Youth unemployment for ages 16-24 reached 22%, with 1.01 million youth unemployed.

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What the French take for granted today- 99% of the French people are covered by national health care- started when Charles De Gaulle faced rising scial discontent in the postwar period, and accepted a demand for worker protections. During the postwar period Frenchmen are paying higher taxes, but in the first 30 years because French salaries were growing fast this was not noticeable. With slow growth and rising healthcare costs its getting harder to increase these tax deductions for overall social security, which have reached one third of apaycheck at the low end, say for ataxi driver in Marseilles. So you have the government running deficits of $15 billion in 2004, even after increasing co-payments for routine care and doctors visits. Experts say this could reach $40 billion in 2010 and $90 billion in 2020. In 2007 health care cost the government $300 billion, or 11 % of GDP, (OECD numbers) and the bureaucracy and rules are getting more complicated. This 11% is well below what Americans pay for asystem that leaves out about 50 million people. France ranked 8th on the OECD list in cost per capita, the US at the top. And the French life expectancy is higher at 80.98 vs. 78.11 for the USA, higher by about 3 years. For this cost the system is cost effective according to the OECD. And the French find the American debate abouthealthcare public option "altogether surreal", as the newspaper Le Monde put it. To keep the system in viable form the government is increasing copayments, such as the decrease in reimbursements from 80% to 65% for routine care and doctors visits in 2004. As aresult the deficit dropped to $6 billion in 2008. ut the global economic crisis and rising unemployment has made this grow to estimated $13 billion for 2009. Measures under consideration: increasing hospitalization copayments to $28 a day from $22. To fill this substantial gap for routine care and other costs the French system has private insurance companies called mutuals that offer different policies. Which is where the Fench notion for equal treatment in health care gets distorted because different people can have different coverage. The French though compare their system to the British system and say theirs is not as nationalized as it appears and the Brisih one is much more so. The French system though supervised by the government is different from government run health care as in Britain. French people are free to choose their own doctor who is often a private practitioner. ...

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Bank of England minutes for the Jan 8-9, 2014 meeting show officials saying "they saw no immediate need to raise the Bank Rate even if the 7% unempoyment threshhold were to be reached in the near future." This comes as the unemployment rate average in 3 months to November 2013 was shown at 7.1%, according to the Office of National Statistics. The rate declined from 7.4% in the previous three months. In August 2013 Bank of England officials said unemployment would have to fall to 7% before raising the Bank's benchmark interest rate. The Bank of England has set the bechmark rate at a low of 0.5% and the size of the bond buying program at 375 billion pounds.

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Tesco plans to hire 20,000 new employees to help improve the shopping experience at Tesco stores in Britain. This would also act as a"shot in the arm" for the UK economy, says Tesco UK CEO, Richard Brasher. Official figures show 2.67 millon people in Britain are unemployed, with unemployment at 22% for young people ages 16-24.

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Britain's unemployment rate edged up from 8.1% to 8.3%. Youth unemployment- joblessness among young people ages 16-24- went up to 1.02 million in October 2011, the Office of National Statistics reported. This takes youth unemployment up to 21.9% The ONS says that noncomparable and nonseasonally adjusted data show youth unemployment exceeding one million in 1984, 1985, and 1986.

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The Center for Economics and Business Research in London estimates GDP growth for the UK of 0.4% in 2012. According to Britain's Office of National Statistics the UK economy contracted by 0.3% in the fourth quarter of 2011 compared to the third quarter.

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The results of a Wall Street Journal analysis of 11 countries shows the risk of a stretched out period of stagnation in the economies of the USA, the UK and Japan. Jobs is a critical area in which this is apparent. In Japan employment is down 3.3% from December 2007, in the UK 2% lower, and in the USA 4.8% lower from December 2007. U.S. household debt is down from 131% in early 2008 to 122%, and poses a big burden. In the UK the household debt is larger than in the USA. And Japan's deficits are over 200% of GDP, creating an overhang that depresses jobs and growth. S. Korea, Taiwan and Australia have benefitted from the recovery since 2008 in China, India and the rest of Asia.

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Sofia Diego from the Southern European region of Spain and Portugal, says the idea of a multi-speed European Union as put forward by some in Brussels, including Jean-Claude Juncker, is not the answer- because at some point it makes the whole exercize of a united Europe futile with some countries choosing to ignore the very ideal of European unity. In fact she says we have come too far in that direction and it is necessary to pause and reflect what this means. France's leading presidential candidate Emmanuel Macron has called for a closer union as a better solution to eurozone financial stability with a tighter union. German public opinion and other opinion in the EU does not favor more concessions following Brexit. This opinion from a Southern European country shows how young people especially have developed a new attitude and feeling of togetherness as the European generation. Young people from all parts of Europe have a changed attitude compared to previous generation, and this is a valuable experience that needs to be nurtured with closer interaction to take the EU experiment to the next stage. ...

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Ireland's prime minister Enda Kenny says following the Brexit vote that is seen as a disaster for Northern Ireland-"My first interest is Ireland's interests, the protection of the common travel area, the peace process, the open border." Other issues facing Ireland are economic- British people will find Ireland's exports costlier by 10 percent, and make Ireland costlier for British tourists who make up 41% of all Ireland's tourists. Ireland's effort to build an all island health system is also at risk. As Ireland tackles this economic problem it is also moving to attract new business to relocate in Dublin. Among ordinary people the fears are more basic- no one wants to go back to the old days and the sectarian strife and conflicts. For most people the open borders mean a great deal- an achievement that took a long, long time, and no one can see this being reversed overnight, which is why Northern Ireland voted 58% to remain in the EU. ...

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Britain's Office of National Statistics said that GDP declined by 0.2% in the first quarter of 2012 from the prior quarter. GDP declined by 0.3% in the fourth quarter of 2011. This means Britain is officially in a recession, with two consecutive quarters of negative growth. The ONS said GDP was 4.3% below its precrisis peak in the first quarter of 2008. The UK registered growth of a mere 0.4% since the coalition government of David Cameron took over in May 2010. This presents problems for prime minister Cameron in tackling the UK deficit. It also shows how difficult it will be for EU countries to address their deficits without economic growth. This has come into increasing focus with recent events in the Netherlands with the collapse of the government and upcoming elections on the issue of austerity cuts, and in France with the presidential elections and the swing to parties questioning austerity measures without economic growth.