GDP Growth Rate 2% - This is Starting to Feel Real

Third quarter GDP grew at a annual rate of 2%. This is the third or fourth consecutive quarter of GDP growth.


This is great news and what makes it even better is the notion that not only is the GDP still growing but the overall economic growth rate is rising. This means that we are growing faster and faster. July through September yielded a growth rate of 2% and the months of April through June hosted a growth rate of 1.7% thus the rate has grown by about 15 - 20% which is outstanding.

The unemployment rate is still high, now at 9.6%, but folks have been expecting the unemployment rate to stay around these levels. Plus the free market, or rather the private sector, has created more jobs over the last nine months or so. They are running on a surplus. It is government budget cuts, and thus the need to eliminate jobs, or at least not hire, that has created the negative job figures.

Consumers are both saving and spending more. The notion that consumers are increasing their spending despite the decline in consumer credit is wonderful. The health of American consumer personal finance is on the rise there is no doubt about it.

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CHAMPIONING THE SMALL BUSINESS SECTOR

According to the Guardian today, the UK Government is to develop a "brutally honest" review of strategies designed to encourage new start-ups.

Led by the former Secretary of State for Trade and Industry, Lord Young of Graffham, the review will aim to:

- minimise the "bureaucratic burdens" which increase costs and hassle
- identify ways that government departments can help ensure firms have access to sufficient finance
- encourage people to start businesses rather than seek jobs as employee
- improve the way government listens to the views of small and medium-sized enterprises when designing policy

The focus on small businesses as drivers for the UK economy is in stark contrast to the Welsh Assembly Government’s focus on large anchor companies to drive forward the Welsh economy, a strategy that the First Minister Carwyn Jones emphasised time and time again when running for the leadership of the Welsh Labour Party and one which was fully adopted by Ieuan Wyn Jones for his Economic Renewal Programme.

However, as will be discussed on this blog tomorrow, WAG's own statistics show that it is the small firm sector that has created the majority of jobs in Wales during the last few years in Wales and should be the focus of government policy in revitalising the Welsh economy.

It is just a shame that WAG, which abolished the groundbreaking Entrepreneurship Action Plan for Wales, has not seen fit to do the same as the UK Government and have instead have opted for a strategy that focuses on the part of the economy that is not creating jobs at a time when we need them the most.