It seems today’s good jobs figures — employment at a record high and the unemployment rate back below 8 per cent — are at least partly thanks to the Olympic Games.
While the UK added 212,000 net jobs in June-August, London alone added 101,000 — accounting for 47 per cent of the total rise. And — as Citi’s Michael Saunders observes — the six boroughs that hosted the Games (Hackney, Newham, Barking and Dagenham, Waltham Forest, Tower Hamlets and Greenwich) have seen their proportion of residents claiming Jobseeker’s Allowance fall by an average of 0.48 percentage points, compared to 0.25 points for the other 27 London boroughs and 0.1 points for the country as a whole.
Hackney’s dole queue is 1,252 people shorter than it was a year ago — the biggest drop of any local authority in the country.
But those hoping for wider economic benefits from the Games are likely to be disappointed. There was no spectacular boost in tourism — the number of foreign visitors to the UK this summer was 7 per cent lower than last year — or retail — sales fell by 0.2 per cent from July to August, although they were up 2.7 per cent on August 2011. Citi Research says ‘in our view, the Olympics proved to be a fantastic sporting event, but not an economic policy’.
As for GDP, the Bank of England has estimated that the Games would add about 0.2 points to Q3 growth. That, coupled with the effect of the Diamond Jubilee (which reduced Q2 growth by about 0.5 points, hence boosting Q3 growth by 0.5 points), should produce growth of 0.7 per cent in Q3. The NIESR estimates that Q3 growth was actually 0.8 per cent, suggesting underlying growth was just above zero. We’ll get the ONS’s first estimate a week tomorrow.