In the slow lane

New economic forecasts from the OECD show how bad austerity has been for growth.

The OECD's latest interim assessment of the outlook for the G7 economies, published on 29 March, suggests the UK economy is back in recession (usually defined by economists as two consecutive quarters of falling real GDP). A day earlier the Office for National Statistics published revised national accounts data showing real GDP contracted by 0.3 per cent in the final quarter of 2011. In its report, the OECD says it thinks this will be followed by a 0.1 per cent contraction in the first quarter of 2012.

The Office for Budget Responsibility (OBR) takes a more optimistic view in its latest forecast, published alongside the budget. It thinks the economy will grow by 0.3 per cent in the first quarter.

Differences in opinion between groups of economists over the outlook for the economy are not unknown, but it is a little surprising that two essentially consensual bodies like the OECD and the OBR have come up with such different forecasts for the current quarter, particularly when we are already at the end of March.

Typically, when trying to forecast very recent developments in the economy, economists look at surveys of business confidence. These have been shown to be the most reliable indicators of short-term fluctuations in activity (measures of consumer confidence are much less useful) and they support the OBR's forecast over the OECD's. Indeed, the OBR cite an improvement in survey evidence to justify their optimism that the economy will expanded in the first quarter.

Unfortunately, the OECD is less forthcoming about the reasons for its pessimism. It does, though, also forecast a recession in the three largest euro zone countries, taken together, and it may be that its economists believe this will cause a recession in the UK too.

What the OECD forecasts do show, however, is that even if the OBR are right about the outlook for the UK in coming quarters, the UK is experiencing a relatively slow economic recovery. Four years after the economy went into recession, real GDP will still be almost 4 per cent lower than at its peak. This makes the recovery slower than any economic recovery in the UK in the last century; it also means that the UK recovery is slower than those of all the other G7 economies bar Italy.

Why is this the case? In a recent speech, Adam Posen, one of the external members of the Bank of England's Monetary Policy Committee, analysed the gap between the recovery in the US and the recovery in the UK. He concluded that it was largely the result of differences in fiscal policy. The more aggressive fiscal tightening in the UK led to weaker consumer spending growth, which in turn helped explain why investment had failed to recover in the UK as fast as in the US.

When it came to power, the coalition argued that it had no choice but to increase taxes and make substantial cuts in public spending to eliminate the fiscal deficit over the course of four years (a timetable that has now been extended to six years). It also argued that this would not be bad for growth because private sector activity would expand to fill the gap left by the public sector.

The first proposition is still open to debate - and without a counterfactual we will never know for sure whether the government was right or not. But the second proposition has been shown to be false. Whether the OECD or the OBR are proved to be right about growth in the first quarter of 2012, by any measure the economic recovery in the UK has been hugely disappointing since the coalition took office.

Rather than stimulate activity in the private sector, austerity in the public sector has made it less willing to invest and recruit. Fiscal tightening has been bad for growth.

Tony Dolphin is the senior economist at ippr

Chancellor George Osborne. Photo: Getty Images

Tony Dolphin is chief economist at IPPR

Photo: ASA
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Harmful gender stereotypes in ads have real impact – so we're challenging them

The ASA must make sure future generations don't recoil at our commercials.

July’s been quite the month for gender in the news. From Jodie Whittaker’s casting in Doctor Who, to trains “so simple even women can drive them”, to how much the Beeb pays its female talent, gender issues have dominated. 

You might think it was an appropriate time for the Advertising Standards Authority (ASA) to launch our own contribution to the debate, Depictions, Perceptions and Harm: a report on gender stereotypes in advertising, the result of more than a year’s careful scrutiny of the evidence base.

Our report makes the case that, while most ads (and the businesses behind them) are getting it right when it comes to avoiding damaging gender stereotypes, the evidence suggests that some could do with reigning it in a little. Specifically, it argues that some ads can contribute to real world harms in the way they portray gender roles and characteristics.

We’re not talking here about ads that show a woman doing the cleaning or a man the DIY. It would be most odd if advertisers couldn’t depict a woman doing the family shop or a man mowing the lawn. Ads cannot be divorced from reality.

What we’re talking about is ads that go significantly further by, for example, suggesting through their content and context that it’s a mum’s sole duty to tidy up after her family, who’ve just trashed the house. Or that an activity or career is inappropriate for a girl because it’s the preserve of men. Or that boys are not “proper” boys if they’re not strong and stoical. Or that men are hopeless at simple parental or household tasks because they’re, well...men.

Advertising is only a small contributor to gender stereotyping, but a contributor it is. And there’s ever greater recognition of the harms that can result from gender stereotyping. Put simply, gender stereotypes can lead us to have a narrower sense of ourselves – how we can behave, who we can be, the opportunities we can take, the decisions we can make. And they can lead other people to have a narrower sense of us too. 

That can affect individuals, whatever their gender. It can affect the economy: we have a shortage of engineers in this country, in part, says the UK’s National Academy of Engineering, because many women don’t see it as a career for them. And it can affect our society as a whole.

Many businesses get this already. A few weeks ago, UN Women and Unilever announced the global launch of Unstereotype Alliance, with some of the world’s biggest companies, including Proctor & Gamble, Mars, Diageo, Facebook and Google signing up. Advertising agencies like JWT and UM have very recently published their own research, further shining the spotlight on gender stereotyping in advertising. 

At the ASA, we see our UK work as a complement to an increasingly global response to the issue. And we’re doing it with broad support from the UK advertising industry: the Committees of Advertising Practice (CAP) – the industry bodies which author the UK Advertising Codes that we administer – have been very closely involved in our work and will now flesh out the standards we need to help advertisers stay on the right side of the line.

Needless to say, our report has attracted a fair amount of comment. And commentators have made some interesting and important arguments. Take my “ads cannot be divorced from reality” point above. Clearly we – the UK advertising regulator - must take into account the way things are, but what should we do if, for example, an ad is reflecting a part of society as it is now, but that part is not fair and equal? 

The ad might simply be mirroring the way things are, but at a time when many people in our society, including through public policy and equality laws, are trying to mould it into something different. If we reign in the more extreme examples, are we being social engineers? Or are we simply taking a small step in redressing the imbalance in a society where the drip, drip, drip of gender stereotyping over many years has, itself, been social engineering. And social engineering which, ironically, has left us with too few engineers.

Read more: Why new rules on gender stereotyping in ads benefit men, too

The report gave news outlets a chance to run plenty of well-known ads from yesteryear. Fairy Liquid, Shake 'n' Vac and some real “even a woman can open it”-type horrors from decades ago. For some, that was an opportunity to make the point that ads really were sexist back then, but everything’s fine on the gender stereotyping front today. That argument shows a real lack of imagination. 

History has not stopped. If we’re looking back at ads of 50 years ago and marvelling at how we thought they were OK back then, despite knowing they were products of their time, won’t our children and grandchildren be doing exactly the same thing in 50 years’ time? What “norms” now will seem antiquated and unpleasant in the future? We think the evidence points to some portrayals of gender roles and characteristics being precisely such norms, excused by some today on the basis that that’s just the way it is.

Our report signals that change is coming. CAP will now work on the standards so we can pin down the rules and official guidance. We don’t want to catch advertisers out, so we and CAP will work hard to provide as much advice and training as we can, so they can get their ads right in the first place. And from next year, we at the ASA will make sure those standards are followed, taking care that our regulation is balanced and wholly respectful of the public’s desire to continue to see creative ads that are relevant, entertaining and informative. 

You won’t see a sea-change in the ads that appear, but we hope to smooth some of the rougher edges. This is a small but important step in making sure modern society is better represented in ads.

Guy Parker is CEO of the ASA