The Monetary Policy Committee would probably love to increase interest rates at this juncture, but with inflation on the up will have their hands tied. Most scary is that half of the month’s increase has come from increased food costs – bread prices surged by 15.9%, meat products by 16.3%, milk cheese and eggs by 19%. Electricity, gas and oil-based fuels produced the rest of the increase. These are all inescapable necessities of life and as such none of us are likely to go unscathed.
The knock-on effects last seen in the early 2000s are already showing up in UK statistics. Unemployment, not often seen in Jersey and rarely requiring comment, is on the rise in the UK, with the June increase the largest since December 1992.
The cost of building is another indication that the economy is facing hard times. According to a report from the Royal Institution of Chartered Surveyors raw materials and labour costs have risen by 12.2% in the past year and could increase by a further 12% over the next 24 months. The rising costs of cement, steel piling and fuel are having ‘a dramatic impact’ on civil engineering construction costs, they say, with projects likely to face delays and at worst cancellation. How much this will affect building projects in this Island is a matter for speculation, at this stage.
While it is fair to say that there are firms bucking the trend – Balfour Beatty being one – there seems little likelihood of any light relief for the foreseeable future. Late holiday costs are soaring, say Thomas Cook, and even the number of flights using UK air space has gone down – for the first time since the fatal air strike on 11 September 2001.
No wonder, according to statistics, that most workers believe they are underpaid by at least £5,000.
IMAGINE the furore if one of our (two) major supermarkets announced that the price of milk would be reduced to 50p, for two pints.
Unlikely, say we all, but that’s exactly what happened last week in the UK. With the credit crunch biting into their profit margins, both Asda and Tesco said they were slashing prices to try to pull punters away from the discount stores like Aldi and Lidl. As well as milk, Asda were offering bread, butter, eggs, meat and vegetables at a knock-down 50p. Just for a couple of days.
Producers in Jersey would no doubt love to be able to offer the same, but also without doubt it would be completely unrealistic to expect them to do so.
I’m not sure what Tesco are offering, but in the Isle of Man, where there is a Tesco store, the inflation rate leapt to six per cent in July – some indication of where the next quarterly Channel Island figures are likely to be heading come September.
In the meantime, the difference between the UK basket of goods and ours in the Channel Islands is likely to widen still further.
WHAT a shame that just as Jersey’s tourism is getting back on its feet the world economy is conspiring against it.
According to UK figures published last week the number of visitors coming to Britain from overseas has fallen in the last three months. Notably, visitors coming from the United States are currently less likely to visit, partly because their own economy is seeing hard times but also because the value of the US dollar has fallen against the pound.
Not that currency seems to make much difference – visitors from Europe are down as well, even though the value of the euro against the pound is much more favourable than for those going in the other direction.
Only a few weeks ago a representative from VisitBritain was advising Jersey’s tourism industry to target people visiting the mainland from foreign climes such as the US and Japan. But with numbers on the wane this looks a less than attractive proposition.
It’s hard to say what Jersey’s tourism figures will look like come the end of 2008, with September and October becoming quite lucrative shoulder months in recent years.
But the fact that the sun shone as ever on the annual Battle of Flowers (despite the dreary forecast) should encourage some repeat business. Maybe there is justice up above after all.
HAVING just arrived back from a fortnight on the Continent, I’d like to put in my three penny’s worth on the subject of the proposed time change.
How much nicer would it be, for instance, to be able to enjoy a longer hour of daylight – even at this time of year, let alone in the winter.
The Continentals think nothing of sitting outside for a drink long into the evening. Cafés spilling out onto the pavements and squares are busy well past 10 pm because, at the time of writing, daylight doesn’t wane until around 9.30 pm.
For some years now the Island has been struggling to find that cultural edge which aligns it less with the UK high street and more with European destinations.
This year the trend seems to have almost taken off, with more cafés in our town centre offering al fresco seating.
On weekday mornings you could almost believe you were somewhere else, with fresh air fiends (and smokers, naturally) enjoying a coffee in the open air.
So why not go all the way, embrace the closeness of the Island to France, and indulge us all?
Weather permitting, of course.