Charlotte Street Partners

DAILY BRIEFING

DAILY BRIEFING

This time, it's personnel

Written by Charles Clegg, senior associate 
Edited by Kevin Pringle, partner
30 August 2021

Good morning,

When he joined Britain’s wartime coalition as minister of labour, Ernest Bevin remarked: “They said that Gladstone was at the Treasury for fifty years, I want to be at the Ministry of Labour for fifty years.”
 
That was 1940. Bevin didn’t quite manage fifty. By the time Margaret Thatcher became prime minister in 1979, Bevin’s vision of strong unions co-operating with government was already beyond repair.
 
Since then, successive Conservative and Labour governments have accepted a consensus that labour is no longer an estate of the realm. Unions need only be engaged issue-by-issue. Post-Covid, however, this consensus could be shifting.
 
The UK is short on workers. Despite high vacancies, not enough jobs are in the right areas. Due to Covid, other countries are experiencing similar problems. Post-Brexit, the issue is more acute in the UK due to the outflow of EU nationals and governments’ and employers’ long-term neglect of training.
 
The effect has been that many workers now command more clout than they did before the pandemic. This is seen not only in growing pay demands but in an increased public recognition of the value of staff in low-paid jobs.
 
Ending freedom of movement was always going to necessitate a realignment in the UK’s labour market. Covid has accelerated this. How will employers and government fill gaps in labour and training? That question deserves a major policy discussion.
 
Here too is an opportunity for Britain’s trade unions. This month, the UK’s largest union, Unite, elected Sharon Graham as its first female leader. Graham brings with her a desire to focus on working conditions rather than internal politics. Now, amid empty shelves, we see what key workers – or a lack of them – can result in.
 
Ernest Bevin isn’t back in government. Far from it. Yet the era of piecemeal public policy on employee issues could be coming to a close.

News

New Orleans has lost power as Hurricane Ida made landfall in the US state of Louisiana. The storm has been classified as “extremely dangerous” and brings winds of up to 150mph.
 
The US has carried out a second drone strike on suspected ISIS-K terrorists in Kabul. According to an Afghan official, the attack destroyed a car containing “multiple suicide bombers” while also killing three children standing-by. 
 
The UK government has revised travel restrictions for travellers returning to England. Canada, Denmark, Finland, Switzerland, the Azores, Liechtenstein, and Lithuania move to the green list, while Montenegro and Thailand have moved from the amber list to red.
 
Nicola Sturgeon is self-isolating after coming into close contact with someone who tested positive with Covid. The first minister of Scotland tweeted the news on Sunday evening.

Business and economy

The Federation of Small Businesses has called England’s system of business rates “outdated and regressive” while claiming they will prove a major hindrance to Covid recovery. The call comes ahead of the publication of a review of business rates this autumn.
 
The UK has been named the best European country in which to start a new business. The survey, which was carried out by e-money platform Tide, took account of factors such as GDP and the employment rate.
 
A consortium led by Northumberland Estates is targeting PD Ports for a £2bn takeover of Teesport in North East England. The deal is supported by Tees Valley mayor, Ben Houchen, who believes the takeover would allow the port to be integrated into Teesside’s freeport scheme

Columns of note

Demand for labour is outstripping supply. Surely this is a bad thing? In the Financial Times, Martin Sandhu argues the contrary. He points to demand, affordable capital, and the necessity of training as three factors that are driving a boom in productivity across the world. (£)
 
Throughout the crises of Covid and Afghanistan, Rishi Sunak has kept his personal ratings high. In the Guardian, Andrew Rawnsley looks at the paranoia the chancellor’s success is engendering in the prime minister. Rawnsley shows how the fissures between the two men are creating a “highly combustible” atmosphere on Downing Street.

Cartoon source: New Yorker

Markets

What’s happening this week?

Tuesday represents the final deadline for the departure of all US and allied troops from Afghanistan. From Wednesday, most UK schools outside Scotland will return after summer holidays.
 
In companies, Zoom and Melrose will announce results this week. The Eurozone’s inflation data will be published on Tuesday, followed by unemployment figures on Wednesday and retail sales on Friday. The Bank of England’s monthly spending index is also due out this week.

What’s happening today?

Finals
Base Resources

EGMs
Afarax Group

UK economic announcements
(07:00) Nationwide House Price Index
(09:30) Mortgage Approvals
(09:30) M4 Money Supply

International economic announcements
(10:00) Consumer Confidence (EU)
(10:00) Industrial Confidence (EU)
(10:00) Business Climate Indicator (EU)
(10:00) Services Sentiment (EU)
(15:00) Pending Homes Sales (US)

did you know

Texas rancher Samuel Maverick, from whose name the word “maverick” derives, was grandfather of politician Maury Maverick, who invented the word “gobbledygook”.

Parliamentary highlights

House of Commons

The House of Commons is in recess. The House will next sit on 6 September.

House of Lords 

The House of Lords is in recess. The House will next sit on 6 September.

Scottish parliament 

The Scottish parliament is in recess until 30 August.

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