ONS Economic Forum

1. Economic Forum
20 June 2022
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2. Chief Economist and Director of
Macroeconomic Statistics and Analysis
@GrantFitzner
Economic Forum
Grant Fitzner
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3. Agenda
09:30 – 09:35 Welcome and introduction – Grant Fitzner, Chief Economist, Office
for National Statistics
09:35 – 09:45 State of the UK Economy – Sam Beckett, Second Permanent
Secretary, Office for National Statistics
09:45 – 09:55 Worries about the rising cost of living in Great Britain - Ben
Windsor-Shellard, Office for National Statistics
09:55 – 10:05 Impact on UK finance during the coronavirus (COVID 19)
pandemic: June 2022 – Muhammed Khaliq, Office for National
Statistics
10:05 – 10:25 Q&A
10:25 – 10:30 Closing remarks – Grant Fitzner, Chief Economist, Office for
National Statistics
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4. Questions can be submitted via the slido app using code #11921.
You can also access slido via the link in the chat box.

5. Second Permanent Secretary and
Joint Head of the Government
Economic Service
State of the UK Economy
June 2022
Sam Beckett
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6. GDP contracted by 0.3% in April
-0.4
-0.2
0.0
0.2
0.4
0.6
0.8
1.0
Nov 2021 Dec 2021 Jan 2022 Feb 2022 Mar 2022 Apr 2022
Percentage
points
Contributions to Monthly GDP,
November 2021 to April 2022
Services Production Construction GDP
-0.6 -0.4 -0.2 0.0 0.2 0.4
Wholesale And Retail Trade
Other Service Activities
Administrative And Support Services
Information And Communication
Real Estate Activities
Accommodation And Food Services
Activities of Households as employers
Public Administration And Defence
Transportation And Storage
Education
Arts Entertainment And Recreation
Financial And Insurance Activities
Professional Scientific And Technical Activities
Human Health And Social Work Activities
Percentage points
Contributions to Services in April 2022
Source: ONS Monthly GDP Estimate Source: ONS Monthly GDP Estimate
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7. The labour market continues to be tight
0
200
400
600
800
1000
1200
1400
Thousands
UK job vacancies
Source: ONS Vacancy Survey
-400
-200
0
200
400
600
800
2020 2021 2022
Thousands
Change in economic inactivity from Feb 2020 qtr
Student Looking after family / home
Temp sick Long-term sick
Discouraged workers Retired
Other Inactivity
Source: ONS Labour Force Survey
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8. But real incomes are increasingly being squeezed by higher inflation
-6
-4
-2
0
2
4
6
8
10
2001 2006 2011 2016 2021
Annual
percentage
change
Total vs regular pay growth - Nominal
Total Pay (Nominal) Regular Pay (Nominal)
-6
-4
-2
0
2
4
6
8
10
2001 2006 2011 2016 2021
Annual
percentage
change
Total vs regular pay growth - Real
Total Pay (Real) Regular Pay (Real)
Source: ONS Monthly Wages and Salaries Survey Source: ONS Monthly Wages and Salaries Survey, Consumer Prices
Note: Nominal earnings have been deflated by CPIH
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9. Public expectations of inflation have been rising
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
May 21 Aug 21 Nov 21 Feb 22 May 22
Per
cent
Median inflation expectations
1 Year 5 Years
Source: Bank of England/Ipsos Inflation Attitudes Survey Source: ONS Tracking the price of the lowest-cost grocery items
80
90
100
110
120
130
140
150
160
April
2021
=
100
Lowest price of groceries
Pasta Potato Max Min All
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10. Around 75% of the increase in household saving
during the pandemic reflects ‘forced’ saving
0%
5%
10%
15%
20%
25%
30%
2017 Q1 2018 Q1 2019 Q1 2020 Q1 2021 Q1
Household savings ratio
Saving ratio in 2019 Q4 Saving ratio
-5%
0%
5%
10%
15%
20%
2020
Q1
2020
Q2
2020
Q3
2020
Q4
2021
Q1
2021
Q2
2021
Q3
2021
Q4
Additional savings relative to Quarter 4 2019
Precautionary Intertemporal Forced Total
Source: ONS Quarterly Sector Accounts Source: ONS analysis of Quarterly Sector Accounts
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11. Forecasts for the UK economy are being revised down
-1
0
1
2
3
4
5
Consensus BoE OECD*
Per
cent
UK GDP Forecasts: 2022
Feb-22 May-22
-1
0
1
2
3
4
5
Consensus BoE OECD*
Per
cent
UK GDP Forecasts: 2023
Feb-22 May-22
Source: HM Treasury, Bank of England, OECD Source: HM Treasury, Bank of England, OECD
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12. Conclusions
• The labour market remains tight, although the squeeze
on real incomes is intensifying
• The response of households to the cost-of-living crisis
will be important in how the economy evolves
• Forecasts for the UK economy are becoming more
downbeat
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13. Synthesis Team Lead
Strategy, Synthesis and Coordination Division
Office for National Statistics
Worries about the rising
cost of living in Great
Britain
Ben Windsor-Shellard
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14. The issues people feel worried about
3 in 4 worried about the rising costs of
living
When asked about a range of issues, the
most frequently reported worries were
about the conflict in Ukraine (78%) and the
rising costs of living (74%).
Based on data collected between 25 May
to 5 June from the Opinions and Lifestyle
Survey.
Source: Public opinions and social trends
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15. Worries about the rising costs of living (CoL)
• Analysis on the characteristics of those feeling the most
worried including associations with measures of well-
being.
• Opinions and Lifestyle Survey – Great Britain coverage.
• Adults aged 16 years and above.
• Data on the extent of worry and how frequently those worries were felt –
with reference to the two weeks before interview – collected between 27
April and 22 May.
Main caveats: no evidence of causality; those most extremely
impacted by the rising costs may not be captured by the survey.
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16. Worries about the CoL – sex and age
Those who reported feeling worried (very or
somewhat):
Sex
81% of women compared with 73% of men.
Age
30 to 49 years (82%) and 50 to 69 years
(77%) more worried than those aged 70 years
and over.
16 to 29 years generally more likely than other
ages to feel somewhat unworried or not at all
worried (11%).
Source: Worries about the rising costs of living, Great Britain, April to May 2022
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17. Worries about the CoL – disability status
Those who reported feeling worried (very or
somewhat):
Over 4 in 5 disabled people felt worried
82% who said they were disabled compared
with 75% who said they were non disabled felt
worried.
Source: Worries about the rising costs of living, Great Britain, April to May 2022
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18. Worries about the CoL – parental status
Those who reported feeling worried (very or
somewhat):
9 in 10 parents with a dependent child
aged 0 to 4 years felt worried
Parents living with a dependent child aged 0
to 4 years were more likely than non-parents
or parents not living with dependent children
to feel worried – 90% compared with 76%.
Source: Worries about the rising costs of living, Great Britain, April to May 2022
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19. Worries about the CoL – gross personal income
Those on the lowest gross personal annual
income more likely to feel “very worried”
Similar proportions of adults reported feeling
very or somewhat worried regardless of their
personal gross annual income.
Instead, adults were less likely to feel very
worried as their gross personal income
increased.
Main caveat: gross personal income
does not include any shared financial
resource
Source: Worries about the rising costs of living, Great Britain, April to May 2022
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20. Association with well-being
Main caveat: no evidence of causality
We asked people to evaluate their well-being
using several measures including anxiety, life
satisfaction, and overall health. We then
looked at the % with particular scores on each
measure.
Those feeling the most worried reported
worse scores on all of the well-being
measures, compared to those who were
not at all worried.
Source: Worries about the rising costs of living, Great Britain, April to May 2022
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21. Worries about the CoL and worries about
COVID-19
Adults who were very worried about the rising
costs of living were also most likely to report
feeling very worried about the impact COVID-
19 was having on their life when interviewed
(63%).
“Very worried” adults could be worried about a
range of issues.
CoL
Source: Worries about the rising costs of living, Great Britain, April to May 2022
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22. Half of the “very worried” adults felt these
worries nearly every day
1 in 2 adults who were very worried about the
rising costs of living felt these worries nearly
every day, contrasted with 4 in 100 adults who
were somewhat worried.
Source: Worries about the rising costs of living, Great Britain, April to May 2022
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23. Actions in response to the rising costs
Around 9 in 10 people said their living costs had increased
Among these, those who said they were very worried about the
rising costs of living reported higher frequencies for a wide range
of actions* to mitigate the cost of living including:
• spending less on non-essentials (68% v. 6% in those not at all worried);
• spending less on gas and/or electricity (61% v. 21%);
• spending less on food and essentials (60% v. 1%).
* Survey respondents could choose more than one option.
Source: Worries about the rising costs of living, Great Britain, April to May 2022
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24. See our publication for more data on the
characteristics of those feeling the most
worried.
Worries about the rising costs of living
Our Public Opinions and Social Trends
fortnightly publication will continue to
report estimates of people’s worries.
Thank you to Katie Edser and Priya
Tanna for their work on the analysis
presented today.
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25. Economist
Office for National Statistics
Impact on UK finance
during the coronavirus
(COVID-19) pandemic:
June 2022
Muhammed Khaliq
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26. Introduction
• During an economic crisis, the banking sector’s role in providing
credit becomes more important.
• Our analysis presents key insights into the functioning of the UK
banking sector and financial flows (loans and deposits) during
the coronavirus (COVID-19) pandemic, and how these compared
with the global financial crisis in 2008 to 2009.
• We present provisional insights into the impact of the cost of
living crisis on finance in 2022.
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27. Banks raised their lending of loans during the Covid-19 pandemic, while
households and businesses raised their holdings of deposits
Net financial assets, UK monetary financial institutions, share of GDP, 2007 to 2009 and 2019 to 2021
A positive net value shows net
lending (plus) while a negative net
value shows net borrowing (minus).
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28. Households raised their liabilities of loans following the
Covid-19 pandemic
-1%
0%
1%
2%
3%
4%
5%
6%
7%
8%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Per
cent
of
GDP
issued by UK monetary financial institutions Secured on dwellings
Consumer Credit, Other long term loans by UK residents Total Liabilities
Loan liabilities by households, 2000-21, share of GDP
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29. Lending by credit cards saw the largest fall and took the
longest to recover
-25
-20
-15
-10
-5
0
5
10
15
31 Jan 18 30 Nov 18 30 Sep 19 31 Jul 20 31 May 21 31 Mar 22
Per
cent
Consumer Credit Other loans and advances Credit card
Annual change in consumer credit by type
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30. Private businesses raised their loan liabilities following the
pandemic, whilst they reduced loans in 2008 and 2009
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
Per
cent
of
GDP
Finance leasing
Secured on dwellings
Issued by UK monetary financial institutions, short term
Liabilities
Loan liabilities by private non-financial corporations, 2000-21, share of GDP
0
10
20
30
40
50
60
70
80
90
Value
(£bn)
CBILS CLBILS BBLS FF Total
Cumulative value of government-backed emergency loans, UK,
May 2020 to May 2021, £ billions
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31. For SMEs,
almost all
industries
experienced a
rise in net loans
Monetary financial institutions' total net loans (including
overdrafts) in all currencies, by size and industry type, March
2020 to March 2022, £ millions
-4,000 -2,000 0 2,000 4,000 6,000 8,000 10,000
Agriculture, hunting, forestry and fishing
Mining and quarrying
Manufacturing
Electricity, gas and water supply
Construction
Wholesale and retail trade
Accommodation and food service activities
Transport, storage and communication
Real estate, professional services and support
activities
Public administration and defence
Education
Human health and social work
Recreational, personal and community service
activities
£ millions
Large SMEs
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32. Households and businesses saw a sharp rise in their assets
of currency and deposits in 2020
-2
-1
0
1
2
3
4
5
6
7
8
9
10
Per
cent
of
GDP
Currency and deposits assets by households, 2000-21, share of GDP
-2
-1
0
1
2
3
4
5
6
7
8
9
10
Per
cent
of
GDP
Currency and deposits assets by non-financial corporations, 2000-21,
share of GDP
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33. Conclusion
• Since the COVID-19 pandemic, there has been a rise in the availability of
loans to households and businesses, which is in contrast to the experience
of the 2008 global financial crisis.
• The asset holdings of deposits by households rose sharply during the
coronavirus pandemic.
• Businesses also raised their deposits holdings.
• More recent evidence shows adults have reported using credit more than
usual, possibly in response to the rising cost of living.
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34. Questions can be submitted via the slido app using code #11921.
You can also access slido via the link in the chat box.
Q&A

35. Closing remarks
Grant Fitzner
Chief Economist and Director of
Macroeconomic Statistics and Analysis
@GrantFitzner
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36. Forthcoming ONS economic analysis
22 June 2022 – Overview of inflation and the cost of living: June 2022
27 June 2022 – Impact of Annual Blue Book 2022 Changes on Current Price and Volume Estimates of Gross
Domestic Product
28 June 2022 – First results from Census 2021 in England and Wales
29 June 2022 – Access to products and services for disabled people, Great Britain: 16 February to 27 March
2022
4 July 2022 – Foreign direct investment, business insights in the UK: June 2020 to January 2021
6 July 2022 – Understanding recent falls in self-employment in the UK
11 July 2022 – Regional patterns in homeworking in the UK: 2019 to 2022
All information on upcoming analysis can be found via the ONS website
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37. Transporting consumer price statistics into the
future, with new data and methods in 2023
Daily transaction data from the
GB rail industry’s ticketing and
revenue system, provided by
Rail Delivery Group
Daily vehicle listings data
provided by Auto Trader, the
UKs largest vehicle advertising
website
Upcoming release:
Research and developments in
the transformation of UK
consumer price statistics
June 28th 2022
LINK
helen.sands@ons.gov.uk

38. ONS User Survey
ONS open participation activities: Labour Market Statistics User
Engagement
The ONS is undertaking an ambitious transformation programme to improve labour market
statistics through survey transformation and increased use of data from administrative and
other sources. The main survey that provides labour market information from an individual
and household perspective is the Labour Force Survey (LFS). With recent developments,
including the addition of the ability to respond by telephone, the ONS is now in a position to
begin moving towards incorporating the transformed LFS data into the regular labour market
data releases.
Please support to this important work by responding here. The survey is live until
29 June 2022
More information, including on how to respond, can be found on our consultation and
stakeholder participation hub: https://consultations.ons.gov.uk
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39. Dates for your diary
18 July 2022 – ONS Economic Forum
Further details on the above event and any upcoming events will be published at
ons.gov.uk/economicevents
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40. Thank you for attending the
Economic Forum
You can keep up to date on all up coming events via
ons.gov.uk/economicevents
If you would like to ask a question or provide any feedback, please do so
via economic.engagement@ons.gov.uk