At the CML conference yesterday, Paul Johnson, director of the Institute for Fiscal Studies said incomes never rose in step with GDP during the boom, so had only benefited corporates and the wealthy and excluded the rest until 2008.
In this “unusual” recession, since 2008, everyone has lost and the more you had, the more you lost,” said Johnson apologising for his bleak presentation.
The recession has been very deep and prolonged, but employment rates remain “astonishingly strong,” despite extensive public sector job losses, although productivity is still falling, he said.
Chancellor George Osborne is likely to face a dilemma shortly as he is unlikely to have met either of his fiscal rules of balancing the budget within five years to 2015 and slashing the national debt, said Johnson.
“Expect more bad news in the Autumn statement on 5 December,” said Johnson.
