Support 100 years of independent journalism.

  1. Business
  2. Economics
3 January 2012updated 27 Sep 2015 1:46am

How have those economic predictions for 2011 held up?

Those economists who insisted that the recovery was on track have been left with egg on their faces.

By David Blanchflower

A year ago, the Financial Times asked economists for their views on how the economy would develop.

Of particular interest is the question: “How will the recovery develop over the next 12 months? Is strong recent growth in the UK symptomatic of a resilient economy?”

The highlights were that a majority were bear-ish on the outcomes. Yours truly seemed to be pretty close to the mark: “The fact of public spending cuts and increased taxes in 2011 suggest that the recovery will falter and growth will be below 1 per cent in 2011.” I went on to suggest that “unemployment will hit 3m unless the government reverses course.” Unemployment hasn’t quite hit 3 million yet — although we still only have data on unemployment up to October — but it is clearly headed there.

Lots of others were also very bear-ish, including Willem Buiter of Citibank, John Mulellbauer of Oxford University, Jonathan Loynes of Capital Economics, Danny Gabay of Fathom Consulting, George Magnus of UBS, Tony Dolphin of IPPR, Doug McWilliams of CEBR and my old grad school colleague, Gerard Lyons of Standard Chartered.

Sign up for The New Statesman’s newsletters Tick the boxes of the newsletters you would like to receive. Quick and essential guide to domestic and global politics from the New Statesman's politics team. The best of the New Statesman, delivered to your inbox every weekday morning. The New Statesman’s global affairs newsletter, every Monday and Friday. A handy, three-minute glance at the week ahead in companies, markets, regulation and investment, landing in your inbox every Monday morning. Our weekly culture newsletter – from books and art to pop culture and memes – sent every Friday. A weekly round-up of some of the best articles featured in the most recent issue of the New Statesman, sent each Saturday. A weekly dig into the New Statesman’s archive of over 100 years of stellar and influential journalism, sent each Wednesday. Sign up to receive information regarding NS events, subscription offers & product updates.
I consent to New Statesman Media Group collecting my details provided via this form in accordance with the Privacy Policy

But there were a large number who were left with egg on their faces, many of whom I debated on various TV and radio shows over the course of the year, who insisted the recovery was well on track when it was plain to see that it had jumped the rails.

I won’t name and shame here but merely direct you to those who were miles off with their predictions.