[lbo-talk] Re: lbo-talk Digest, Vol 1, Issue 2281

James Heartfield Jim at heartfield.demon.co.uk
Tue Jan 27 15:18:20 PST 2004


In message <200401272017.i0RK07uv008892 at infothecary.org>, lbo-talk-request at lbo-talk.org writes
>Can anyone explain what the leading dynamic sector(s) of the British
>economy is/are? I've asked several people on my visit here - the
>financial editor of the Times said "consumption," the editor of the
>Times said "housing." Manufacturing is dead. The IT sector is small
>compared to the U.S. What's kept the country out of recession and
>keeps it growing?
>
>Doug

The housing 'boom' is illusory. There is a massive shortfall in housing, reckoned at around 4 million (conservatively), leading to price hikes that show up as 'growth' on the statistics.

Britain's successful sectors are financial services (the City of London sells insurance and other financial services to the rest of the world), pharmaceuticals, chemicals, business services, like advertising (which it exports), agri-business. The It sector is small compared to the US, but then the US is a lot bigger. Manufacturing is massively reduced, it is true, but still an important sector with improved productivity (see Geoffrey Owen, From Empire to Europe - though since that book was written there has been a further relocation of industry to the developing world). Much of what is called the service sector in the UK would have been counted as industry before, but has been unbundled and re-labeled.

There is a good compendium of British industry in the Department of Trade and Industry's 'Business Clusters in the UK, a first assessment'. -- James Heartfield



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