Do we have too little economic data, or too much?
Counting cranes and railroad traffic.
The Financial Times' economics editor, Chris Giles, has found a new source of data, quietly released by the UK's Health and Safety Executive, which we really should have been checking as an indicator of recovery:
The HSE started requiring the operators of tower cranes – used for new office buildings, infrastructure, larger residential blocks and big public sector projects – to register their addresses in 2010, providing an invaluable snapshot of the building industry in action.
Sadly, the HSE's figures don't actually show a boom just around the corner. Instead, they highlight the gulf between the capital and the rest of the country:
…With London home to only one in eight people in the UK, it has seen more tower cranes notified to the HSE than all the rest of the UK put together. Almost eight in 10 cranes were in London, the southeast and the east of England.
And what national changes they do show aren't actually that good at all:
The total number of cranes registered with the HSE has been falling since 2010, reflecting the difficulties construction companies have faced and cuts in government school and hospital building programmes. In 2010 and 2011, an average of more than 130 new crane sites were notified each month, falling to fewer than 100 in 2012.
It's interesting that journalists, in our need to be the first at everything, have reached the point of re-inventing the national statistics agency. Because while counting cranes is a canny way to get an indicator of where a sector of the economy is at, it's not all that new an idea.
In fact, back in the Great Depression, that was the only way to get anything done. FDR knew that he needed a more accurate way of judging whether his policies were working than just waiting and hoping that the recovery would be obvious; but without a modern statistics agency, he couldn't check the quarterly GDP figures or monthly unemployment figures. So the only way to get up-to-date information was to use proxies; in this case, by looking at railroad traffic, a proxy which is still reported to this day.
The tension is always there, because to actually get an accurate view of the economic situation takes an age. For instance, it now looks likely that when Nigel Lawson made his much-mocked "green shoots of recovery" comment in the early 1990s the economy was actually starting to grow; it was the figures which were incorrect, not the statement. But it took nearly a decade for the ONS to refine its data to the extent that it showed the true picture.
In a way, what we need are fewer stats, not more. Rather than hunting for better, quicker proxies to get a rule-of-thumb picture of the economy, we should be questioning whether we even want to put too much importance on the preliminary GDP estimates, which do, after all, change all the time.
But then we don't get to count cranes.