If you plan ahead, you will be interested in this list . . . and add to it

As a relative “noobe” in the UK, I’ve been frustrated in my search for data about the economy. It is incredibly difficult to get information from the National Statistics Office that in the US and NZ can be slurped online in seconds.

There also seems to be little vision about where we are going.

Repeating complaints and doomsday scenarios doesn’t help, I know. But asking the right questions does.

Yesterday, IT writer, Philip Virgo posted a summary of his lobbying at each of the Party congresses. I’ve reorganised his post below as a set of questions – using his words when they graphically describe the issue.

Questions about the future of work in the UK

  • Which are the industries of the future? [Which are they are, and how are developments in these industries consistently highlighted in the media?]
  • Which industries will have “integrated career paths”?
  • What would be consequences of not having industries with integrated career paths? What is the alternative?
  • Will “home made” careers do? Or, will our children be condemned to a “professional backwater . . . no longer part of the mainstream route to the top – unless they emigrate and don’t come back”?
  • Will our children and grandchildren be “condemned to surf the cybercrud on the fringes of the global information society – as the UK becomes the electronic equivalent of Cannery Row – a post-industrial poor relation to the economic powerhouses of Asia”?

What will attract industries of the future – particularly in IT and information-management?

  • A competitive communications infra-structure and access to world-class broadband
  • Regulatory simplicity, clarity and predictability
  • Fiscal certainty [presumably for companies and employees]
  • Removing planning controls designed for the 50’s and replacing them with controls we need for the information age.
  • “Workforce skills programmes” that develop a critical mass of skilled people in the industries that interest us

Virgo describes the migration of IT businesses out of the UK – Maxwell’s newspapers, Google and Yahoo. Isle of Man, Switzerland and Singapore seem to be attractive destinations largely because they undertake to defend data privacy from interference from the US. If that is so, then a foreign policy component of future planning is also clear.

These questions seem to be a good way to start thinking about life and prospects in the UK in the future

What do you think of them?

Being a ‘noobe’ here, I’d be interested in your thoughts on the right questions to ask . . . and the likely answers.

5 questions to ask about pensions

How’s your pension scheme?  Do you even know?

I just read a post about the closing of “defined benefit” pension schemes that we hear about in the news, and the rather old news that public pensions are not funded – meaning – we are expecting today’s children to grow into adults and pay us out of their NI contributions – to put it starkly.

Do you understand how your pension works?

I started writing a tutorial on pensions and what you should know about your own fund. In my experience, people pay 6% of their own money in and their employer pays as much, if not more.

But few people, including white collar professionals have any idea where the money goes, or whether they will ever get it back.

I’ve deleted the tutorial, though, because I felt as if I was spreading alarm & despondency and though I know more than most people, I am not an actuary.  So I’ll make this deal.

If you want to contact me, I’ll walk you through the questions you should be asking.

Grab your pension handbook, scan the contents, and I’ll walk your through the sections you should be looking for.  You can read the whole thing when you understand the framework.

Five questions we should be asking about pensions

What I wanted to say on the post but got blocked by blogspot’s sign in (give us the option of typing in our blog name would you – open id often crashes), is that we should get over our personal screaming heeby-jeebies and start structuring the debate about pensions as a wider issue.

1 How many people have benefited from pensions?

It is great to think that a pension will give us a fabulous old age, and some people are living royally, but how many people have benefited?  In UK and world wide?

2 What are commitments to the aged?

What are we deeply committed to doing for older people?  And how widespread is that agreement?  Are we honoring that commitment?

For a start, why do we assume that we should stop work at 65?  It was notworthy that in The Economist debate this week, 80% of people voted to raise or abolish the retirement age.

3 What political commitments do we need to honor these commitments?

Most people don’t understand that public pensions are unfunded.  For the most part, the NI contributions of today pay for the pensions for tomorrow.

Has the younger generation, whom we outnumber, agreed to pay us?  Are we increasing the likelihood that they will want to and/or will the economic ability to deliver?

4 What makes us think we can think predict the economy 40-80 years ahead?

When we pay into a pension fund we are agreeing to something that will happen in 40, 50, 60, 70 years ahead.  Can we predict that far?

Perhaps we need another way of thinking about funding old age?

5 What happened to the money we have paid into our pension funds?

In crude terms, it has gone to people who have already retired and a lot has been lost in the credit crunch.

What interests me though, is where our pension funds were/are invested.  When I put in 6% of my salary and my employer puts in another 8% say, I am actually paying a ‘tax’ of 14%.

The money goes into a fund and, because of its size, becomes capital. It is available to companies as capital to grow and expand.

And it is available to governments to borrow (gilts) to fund roads, schools, etc.  They promise to pay it back out of future taxes – hopefully from an economy that is bigger and healthier, but of course, may not be.

And best of all, the government borrows from its citizens rather than from sovereign funds in other countries (government surpluses in other countries.)

What interests me is where do my pension funds go?

Who is using them to invest?  Who was investing banks involved in derivatives, etc?

If you were an employer, would you offer a pension fund.  I am not sure I would.  I would invest in employees’ education.  My greatest concern would that they are very flexible with multiple skills and multiple languages followed by the ability to run their own businesses. That’s the most ethical solution that I can think of.

But if there were no pension funds, who will supply investment capital?  Who does have access to large dollops of money that we call capital?

Right locals -fill me in.  Tell me how it works here!

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Check my facts on Opportunity UK

Employment opportunities in the UK

Today, Twitterers are retweeting BBC’s report that TUC says 60 people are chasing every job in the south, and elsewhere in UK, each job is chased by 10 people.  Is this true?  And if it true, is it unusual?

I wonder if Andy at SironConsulting a leading recruitment agency would make a comment?

Talk facts not negative emotions

I’m a positive psychologist and I hail from Zimbabwe so I know a fair bit about living in an economic crisis.

  • Bad news outweighs good.  People reading the BBC report on their way to work today will need 3 times as much positive information of greater weight just to think straight!  They will need 5 times as much positive information to be creative and to find solutions to challenges of the day.  Be prepared for a rough day at work and stop to take a walk in the park, listen to the birds and admire the daffodils.  You may need it!
  • Even those of use who are good at maths find it difficult to keep track of numbers with lots of zero’s in them.  I don’t undertand why it is so difficult but generally we need to pull out pen and paper and lay out the arithmetic neatly.  Don’t assume journalists have done this.  They are as dazzled as the rest of us!
  • We need information to guide action not to encourage excitable chatter.  We need facts and figures presented, in context, in a way that supports the purpose of the reader.

I find it hard to find facts and figures about the British economy, so I am going to collect them here.  But do check my numbers.  I do know from living in Zimbabwe that we are prone to make errors when lots of zero’s are involved.  Maybe I’ll add an error from time to time to see if you are doublechecking!

And I am also going to relate the facts I find to the issue at the top of our minds: making a living joyfully in the UK!

Here are my two facts for today and my take on the BBC report.

1   We live and work in the 5th largest economy in the world

Wikipedia figures for GDP by country seem to be 2008 and are probably in USD.  In the last year, the pound has weakened and our economy will be smaller now nominal terms. We have also contracted about 1.5%.  A year ago, India was expected to overtake us in size and I imagine this has happened.

So we are probably not 5th any more.  Maybe we are tenth?  Who knows?

We are still massive by any account.

2   We have 4% of the world’s economy and 1% of the world’s population

We have a disproportionate share of the world’s production and services. Yes, we do.  We are well off.

The world’s GDP is around 50 trillion (million millions or 10^6 x 10^6).  Our GDP in the UK is between 2 to 3 trillion USD.  I’ve taken the lower figure to arrive at 4%.

The world has 6 to 7 billion people (thousand millions or 10^3 x 10^6).  In the UK, have 60 million people.  So 1% of the world live here.

We have 4 x our share of the world economy!

Of course, the USA, with GDP of 15 trillion has 30% of the world economy and a population of 300 million, 5% of the world’s population.  So they have 6x their share of the world’s economy and one-and-a-half times our already disproportionate share.  Pareto’s law in action.  A few people command a disproportion share of resources.

A share in the UK economy

Once, we have remembered that we are quite rich, then we can turn to the issue exercising the TUC – the ability of people to take part in the economy.

Our opinions on this matter provide the underlying tension in western politics and seem to go something like this.  Rich people think they should continue to be rich even if they have just lost billions through bad decisions.  People who seek to make a living through employment believe employment should always be available.

It seems a sterile debate to me.  Looking at the UK from the outside, people quarrelling in a rich economy look like governors of the workhouse in the film Oliver stuffing their faces while the boys ate gruel.

It is quite hard for someone who has lost their job, and who is shocked and frightened, to imagine they are in a psychological state similar to  someone who has lost millions or even billions.   Anyway they are in too much shock to care.

Negative emotions are overwhelming, and psychologsits are pretty confident we need 3-5 moderate positive emotions to outweigh 1 mild negative emotion.  A shock like redundancy needs heaps of positive, which is hard when you’ve just lost the social support system of work and you are short of money too.

But reality and commonsense must also kick in here.  Certainly, claim redundancy money, sign on, and do sensible things.  But consider your basic game plan too.

Why are you waiting for other people?

While you are doing sensible things, do start taking charge of your own life.  Aim to come out of this ‘recession’ not only with your house intact and some savings in the bank, but less, less, LESS, dependent on other people for opportunity.

Can you create opportunity and look for another jobs at the same time?

You must.  Otherwise you are in a bizarre position of feeling poor in a country where we control FOUR TIMES our share of the world’s economy.

There are many simple systems.  Here are 4 suggestions.

  1. Buy British corporate poet, David Whyte‘s CD, MidLife and the Great Unknown and listen to it while you commute, or as you take a walk in a park or field in the gentle spring sun.
  2. Buy What Color is Your Parachute? and do the exercises.
  3. Listen to Dr Srikumar Rao talking at Googletalk (50 min) and follow his advice.
  4. Do my “new person and new url per day” exercise.

Absolutely commit yourself to taking charge of your life and join in unashamed abandon a chase to catch up with the US!

We would like 6 times our share of the world’s economy too!

Not for the sake of gluttony but because it is fun to be innovative and productive and when we trade fairly, people in other countries benefit too.

I would love to hear how you take charge of your life.

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