The latest on inflation...
The business news that matters
Hello and welcome to the latest edition of Off to Lunch…
Inflation stayed at 6.7 per cent in September despite expectations that it would fall again, according to the Office for National Statistics.
The good news from the latest data is that inflation is still below what the Bank of England forecast in August, when it published its last monetary policy report, thanks to a larger-than-expected drop last month. However, the bad news is that the UK has the highest rate of inflation in the G7, as the graph from the ONS shows…
Economists had forecast that the consumer price index would fall to 6.6 per cent in September, according to a consensus compiled by Reuters. But it stuck at 6.7 per cent amid a sharp rise in the price of petrol and diesel. The core rate of inflation, which strips out items prone to short-term fluctuations like food and energy, dropped to 6.1 in September compared to 6.2 per cent in August.
Jeremy Hunt, the chancellor, warned last month that there was likely to be a “blip” in the fight to get inflation down because of the rising price of Brent crude oil. Nonetheless, inflation is still well down on the 11.1 per cent it reached last October, as the graph below shows. The consumer price index, the main measure of inflation, is the light-blue line…
You can see some reaction to the data below…
However, should we pay any attention to this data at all? David Smith writes in his latest column for The Times about the challenges facing the ONS in trying to obtain accurate data about the economy and getting people to complete surveys. As he explains:
It may surprise some readers to learn that the unemployment and employment statistics are based not on an actual count, but on what is claimed to be the largest household survey in the UK…
A survey is only as good as its sample and the LFS [Labour Force Survey] is plagued by falling response rates and the difficulty of getting to all the types of people it wants to. Face-to-face interviews, which became impossible during Covid, gave way to phone polling, but this suffers from the problem that many people no longer use landlines, particularly those in rented accommodation. The survey is thus biased towards older people.
The column concludes that the future is bright for economic statistics because of a shift from surveys to big data, although this will take time. You can read the piece here
Other stories that matter…
1. Dominic Cummings has written in his latest newsletter about how the management structure of Apple is a benchmark for how to encourage innovation and why it is far stronger than the one used in Whitehall. Apple promotes experts over managers and there are no general managers overseeing products or projects. You can read more here
2. The Guardian’s morning briefing has a helpful summary of what has been revealed in the Covid-19 enquiry so far. This includes how Sir Patrick Vallance, the chief scientific adviser to the government during the pandemic, kept a diary that involved him making a “brain dump” every evening to protect his mental health. You can read more here
3. The UK needs to make it easier to build warehouses and logistics hubs because the planning system is currently threatening to hold back e-commerce businesses, according to the latest column by Helen Thomas in the Financial Times. You can read the column here
4. A new report by Harvard Business Review looks at how to manage large teams when you are spread thinly, and when managers should realise they are overseeing too many people. “When you manage a large team, it’s easy to feel as though you spend more time wrangling people than guiding them,” says the piece, which you can read here
5. The Wall Street Journal has done an interesting feature on how a family-run business in Pennsylvania is dealing with the growing generational divide between employees. In the case of the Hickman family, the age of the employees spans from 37 to 86, meaning there are totally different views on technology, working hours and key skills. “While they have different management styles and working habits, they steer clear of conflict by staying in their own lane,” the feature says. You can read the piece here
And finally…
Some enjoyable, relaxing and light evening entertainment for you today. I recommend checking-out Hijack on Apple TV+, Silo on Apple TV+ and the third season of Only Murders in the Building on Disney+. You can find more on Hijack here, more on Silo here and more on Only Murders here
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Best
Graham