Brexit has become the inverse of a pair of rose-tinted spectacles. It is the lens through which all negative economic news has come to be interpreted – and magnified. Yesterday, the IMF published its latest forecasts for global economic growth. One might well ask what use this material is, given the IMF’s past record at economic forecasting. But whether these forecasts are of any value or not, they have, predictably enough, been jumped on by the Remain-supporting media in order to scribble yet another chapter of anti-Brexit narrative. Indeed, according to this narrative, it is not just Britain which seems to be suffering now from the moronic, misinformed decision of the UK public to vote to leave the EU in 2016 – it is the entire world.
The Guardian, for example, led its story on the IMF forecasts with the headline ‘IMF: no deal Brexit and Chinese slump are biggest economic risks.’ Yet that is a pretty loose interpretation of what the IMF is saying. The report downgrades the forecast for global economic growth in 2019 from 3.7 per cent to 3.5 per cent. It had already downgraded its forecast in response to the trade between China and the US. The further, most recent downgrade it attributes to slowing demand in Germany – in particular thanks to new emission standards which have reduced car sales – to the ongoing sovereign debts issues in Italy, which have affected demand, and a deeper-than-expected downturn in Turkey. True, it then lists two uncertainties which might cause global growth to turn out lower still: a slowdown in China and a no-deal Brexit. But to single out Brexit for burdening the global economy is a bit rich. In fact, the IMF forecasts the UK to have the joint third highest growth among G7 countries in 2019. The US, it estimates, will grow by 2.5 per cent, Canada 1.9 per cent, UK and France each by 1.5 per cent, Germany 1.3 per cent, Japan 1.1 per cent and Italy 0.6 per cent.
Meanwhile, hard economic data continues to defy those who predict nothing but doom from Brexit. We’ve heard plenty over the past few days about Phillips closing a baby bottle factory in Suffolk with the loss of 430 jobs – news which the BBC had no hesitation in attributing to Brexit. Yet we have heard rather less to put this in context – such as that Phillips is rationalising production all around the world, involving the closure of 20 of its 50 factories. It is the same with reports about Sir James Dyson moving his company HQ to Singapore. It transpires that it will mean only two executives relocating from the UK – the company will continue to employ 3000 workers at its research and development centre in Wiltshire.
The overall employment picture is very different: ONS figures this morning show that yet again employment in the UK has risen to a record high, with 32.5 million people in employment. Moreover, wages are growing strongly – at 3.3 per cent in the year to November, equating to 1.1 per cent in real terms.
Remarkably, employers have carried on hiring while bodies which claim to speak on their behalf, like the CBI, have been doing their best to talk down the economy. Not for the first time since the referendum there is a yawning gap between what businesses say and what they are actually doing. Everything sounds depressing – until you look around at what is actually happening.