Inadequate economic indicators failing to capture true state of UK economy
IPPR think tank proposes new 'outcomes dashboard' to more accurately reflect the things we care about
The UK must broaden its economic indicators and get better at measuring our rapidly changing economy, according to a new discussion paper from the IPPR think-tank.
The new discussion paper, Measuring What Matters – Improving the indicators of economic performance, warns that the focus on a small number of economic indicators, such as GDP, makes it harder to identify and tackle the UK’s biggest economic problems.
Catherine Colebrook, IPPR chief economist and author of the discussion paper said:
“There is a real risk that the UK's current range of economic indicators are failing to capture what's really happening in our rapidly changing economy.
“In particular, the focus on a small number of production indicators, notably GDP, narrows economic debate and perpetuates the myth that growth is all that matters.
“If our economic indicators fail to provide a full and accurate view of our economy, we will struggle to identify problems and take effective action to solve them.
“We need to get better at measuring the impact of new technologies, business models and economic goals, which are driving changing economic behaviour and trends.”
The discussion paper proposes a new dashboard of five economic outcome indicators, to be updated annually, which would directly measure our progress against the outcomes the public wants the economy to deliver – broadly-shared prosperity, justice and sustainability.
The five chosen indicators are:
- the distribution of the gains from growth
- the change in poverty rates among children and adults
- the change in wellbeing disaggregated by income
- the gap between the median income of the poorest region of the UK and the richest
- the gap between projected carbon emissions and the cost-effective path to decarbonisation
Commenting on the new dashboard, Catherine Colebrook said:
“These five indicators would capture the current performance of the economy in achieving the outcomes that matter most - how broadly the economy distributes its rewards, whether it is succeeding at reducing poverty, whether people feel satisfied with their lives, and our progress at moving to an environmentally sustainable model of growth.”
For further details or to arrange an interview with Catherine Colebrook, please contact Florri Burton 07867 388895 / 020 7470 6154 / [email protected]
Measuring What Matters – Improving the indicators of economic performance by Catherine Colebrook, can be found at [https://www.ippr.org/publications/measuring-what-matters] at 00:01 Friday 27th April 2018
IPPR is the UK’s pre-eminent progressive think tank. Our mission is to open up opportunity, power and prosperity to everyone through conducting rigorous research and generating big ideas. With more than 40 staff in offices in London, Manchester, Newcastle and Edinburgh, IPPR is Britain’s only national think tank with a truly national presence.
The IPPR Commission on Economic Justice is a landmark initiative to rethink economic policy for post-Brexit Britain. The Commission brings together leading figures from across society to examine the challenges facing the UK economy and make practical recommendations for reform. Its Interim Report, Time for Change: A New Vision for the British Economy, was published in September 2017. Its final report will be published in September.