How many skips?
23 August 2020
In 1932, US president Herbert Hoover said that the most essential factor to economic recovery was the restoration of confidence.
Judging by comments made to me since launching this blog, confidence is a quality that many tool and equipment hirers possess already. However, it also has to be said that some markets are suffering badly, such as events and hospitality.
Detecting the recovery
An earlier blog post discussed how economists have tried to describe the economy’s trajectory according to letter shapes like V, W or L. Ideas are also being put forward about how to detect when the general recovery is under way.
David Smith, economics editor of The Sunday Times, has for many years suggested his ‘skip index’ as an informal measure. It is simply based on the number of builders’ skips he sees in his street: two indicates that the economy is on trend, four an unsustainable boom, and zero speaks for itself. His most recently reported tally on 2 August was one skip, indicating some growth.
Ice cream sales
Other even more unscientific recovery signs suggested in the past include the number of lofts being converted and ice cream sales.
And some years ago, Northampton was mooted as being something of a bellwether of the overall national economy. With its football team currently playing in League One, the third tier in England, I’m not sure how accurate that is.
No easy task
Forecasting the economic future is no easy task. And as George Bernard Shaw is believed to have said, if all economists were laid end to end, they would not reach a conclusion.
So, regardless of what indicators people might use to predict the future, it’s probably best to be rooted in the here and now. Look at your current figures, listen to what your customers are telling you, and act accordingly.
(Photo: Brett Jordan/Unsplash)