Simon Wren-Lewis in his blog ‘Mainly macro’ attacks Robert Pestons comments on the BBC website about last weeks GDP figures, particularly in relation to austerity but also points out the impact of immigration on the figures.
The other point completely missing from Peston’s account is that the UK’s growth performance even with these revisions is still terrible. As I have often pointed out, high inward migration in recent years means you really have to look at GDP per head to make comparative statements about this recovery. As the ONS point out, this new data still shows that only in this year has GDP per head exceeded its pre-recession peak. Assuming recent data revisions have not changed this, average growth in GDP per head between 1955 and 2008 was about 2.25%. Any recovery from such a deep recession should have seen growth rates well in excess of this. Instead the revised data give us 1.1% growth in 2011, 0.5% in 2012, 1.5% in 2013. Only by 2014 had we got near the long term average growth rate. This is still an absolutely terrible performance for a recovery.
Quite, bumping up the population does not improve living standards per person!