David Cameron and George Osborne speak together during a Q&A session at the construction company Skanska on April 22, 2014 in Rickmansworth. Photograph: Getty Images.
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UK economy grows by 0.8% - but how many are feeling it?

The uncomfortable truth is that for most people, the recovery hasn't even begun. 

The run of good news for the Tories on the economy has continued with today's GDP figures. Growth was 0.8 per cent in quarter one of this year (and 3.1 per cent year-on-year), the fifth successive increase and the longest period of continuous expansion since the crash. The economy is now finally within touching distance (0.6 per cent) of exceeding its pre-recession peak with the right poised to boast that Britain is "bigger than ever". But before hanging out the bunting, recall that GDP per head is still almost 7 per cent lower than in 2008 and that the US, which avoided many of George Osborne's mistakes, is 6.3 per cent larger. 

The UK is on track to be the fastest-growing economy in the G7 this year and to surpass France as the world's fifth biggest economy. But again, recall that growth of 1.8 per cent is needed each quarter between now and the election to match the level predicted by the OBR in autumn 2010. 

The belated recovery, combined with the sharp fall in unemployment to 6.9 per cent, has given Osborne a much better economic story to tell. The danger for the Tories, however, as some of their MPs privately acknowledge, is that most people still aren't feeling the benefits. Wage growth excluding bonuses remains below inflation (1.4 per cent to 1.7 per cent) and there will be no rise in real incomes for the millions of public sector workers who have had their salary increases capped at 1 per cent and for those most reliant on state benefits. In a country as unequal as Britain, average wages are no guide to how the middle and the bottom are faring. In London last year, bankers' pay grew nearly five times faster than the pay of the typical worker. 

For most, after six years of falling living standards, it will take more than a few months of growth to make up the ground lost since the crisis. In 2015, as the IFS has repeatedly pointed out, real incomes will still be far below their 2010 level (paving the way for Miliband's Reagan moment). Many in the private sector remain stranded in low-paid, part-time jobs (1.42 million people are working part-time because they can't find full-time jobs) that do not provide enough for them to maintain their family's living standards.

Indeed, based on the RPI measure of inflation (which includes housing costs), the OBR forecasts that wages will be flat until 2019; there will be plenty of people who feel no better off in the next decade, let alone in the next year. The price of many essentials, such as housing, food, energy and transport, continues to rise faster than the general rate of inflation. For all of these reasons, Labour strategists believe that the party's "cost-of-living" attack will retain its potency in May 2015. 

The risk for the Tories is that the more they boast about the performance of the macroeconomy, the more voters will demand "Why aren't we feeling it?" If they are to have a chance of winning the election, they will need a far ambitious plan to restore the severed link between the nation's growth and individuals' living standards. 

George Eaton is political editor of the New Statesman.

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Inside a shaken city: "I just want to be anywhere that’s not Manchester”

The morning after the bombing of the Manchester Arena has left the city's residents jumpy.

On Tuesday morning, the streets in Manchester city centre were eerily silent.

The commuter hub of Victoria Station - which backs onto the arena - was closed as police combed the area for clues, and despite Mayor Andy Burnham’s line of "business as usual", it looked like people were staying away.

Manchester Arena is the second largest indoor concert venue in Europe. With a capacity crowd of 18,000, on Monday night the venue was packed with young people from around the country - at least 22 of whom will never come home. At around 10.33pm, a suicide bomber detonated his device near the exit. Among the dead was an eight-year-old girl. Many more victims remain in hospital. 

Those Mancunians who were not alerted by the sirens woke to the news of their city's worst terrorist attack. Still, as the day went on, the city’s hubbub soon returned and, by lunchtime, there were shoppers and workers milling around Exchange Square and the town hall.

Tourists snapped images of the Albert Square building in the sunshine, and some even asked police for photographs like any other day.

But throughout the morning there were rumours and speculation about further incidents - the Arndale Centre was closed for a period after 11.40am while swathes of police descended, shutting off the main city centre thoroughfare of Market Street.

Corporation Street - closed off at Exchange Square - was at the centre of the city’s IRA blast. A postbox which survived the 1996 bombing stood in the foreground while officers stood guard, police tape fluttering around cordoned-off spaces.

It’s true that the streets of Manchester have known horror before, but not like this.

I spoke to students Beth and Melissa who were in the bustling centre when they saw people running from two different directions.

They vanished and ducked into River Island, when an alert came over the tannoy, and a staff member herded them through the back door onto the street.

“There were so many police stood outside the Arndale, it was so frightening,” Melissa told me.

“We thought it will be fine, it’ll be safe after last night. There were police everywhere walking in, and we felt like it would be fine.”

Beth said that they had planned a day of shopping, and weren’t put off by the attack.

“We heard about the arena this morning but we decided to come into the city, we were watching it all these morning, but you can’t let this stop you.”

They remembered the 1996 Arndale bombing, but added: “we were too young to really understand”.

And even now they’re older, they still did not really understand what had happened to the city.

“Theres nowhere to go, where’s safe? I just want to go home,” Melissa said. “I just want to be anywhere that’s not Manchester.”

Manchester has seen this sort of thing before - but so long ago that the stunned city dwellers are at a loss. In a city which feels under siege, no one is quite sure how anyone can keep us safe from an unknown threat

“We saw armed police on the streets - there were loads just then," Melissa said. "I trust them to keep us safe.”

But other observers were less comforted by the sign of firearms.

Ben, who I encountered standing outside an office block on Corporation Street watching the police, was not too forthcoming, except to say “They don’t know what they’re looking for, do they?” as I passed.

The spirit of the city is often invoked, and ahead of a vigil tonight in Albert Square, there will be solidarity and strength from the capital of the North.

But the community values which Mancunians hold dear are shaken to the core by what has happened here.

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