Aurelia Butler

Educators are supposed to set an example. Right now that example is to down tools when living costs rise. Teachers at the Girls’ Day School Trust, a band of 23 independent UK schools and two academies, have voted overwhelmingly in favour of striking. It would be the first serious industrial action in the trust’s nearly 150-year history.Employees at 58 British universities were ahead of the pack and staged a three-day walkout in December. With inflation at around 5 per cent, more industrial action is on the cards across the UK.Strikes went by the wayside during the pandemic, thanks largely to government wage support. The Office for National Statistics even stopped tracking labour disputes in 2020. That freed capacity to process pandemic data, but also fitted a narrative — of industrial action declining from the time former prime minister Margaret Thatcher emasculated trade unions in the 1980s. Some 30mn working days were lost at the height of the winter of discontent in 1979; coal miners’ stoppages brought the annual tally up to 27mn a few years later. The most days lost this century was 1.4mn in 2011. In 2019 — the last documented year — the tally was under a quarter of a million.Fresh flashpoints are emerging. Inflation, which historically correlates with strikes, is foremost. The cost of living is rising much faster than wages. According to the University and College Union, university staff have weathered a 20 per cent pay cut in real terms over the past 12 years. The GDST’s plans to withdraw from the Teachers’ Pension Scheme will leave teachers “at least 20 per cent” worse off on average in terms of the annual amount in pension benefits, the union says.Union membership has been creeping up slowly since 2017 to 23.7 per cent of the workforce in 2020. There is a shift towards more members from the public sector compared with the historic strength of the private sector, notes Dave Lyddon, honorary fellow in industrial relations at Keele University. It is here that increasing strike action will be concentrated. But with membership halving in 40 years, there will be no rerun of the 1970s.The Lex team is interested in hearing more from readers. Please tell us what you think of the growing industrial unrest in the comments section below. More

Investing.com — For the last two years, Prime Minister Boris Johnson and his team have been partying in Downing Street. However, it’s his voters who are going to feel the hangover.But while the British press may prefer to dwell on the scandal about Downing Street breaching its own Covid rules, there is a real economic storm brewing that will be an even sterner test for the country. By May, it is safe to say, many voters – especially poorer ones – will be feeling nostalgic for the times when they only had to worry about a party here and there.None of the looming issues are unique to Britain. It is only the public rage at the government’s hypocrisy and disingenuous maneuvering to escape the consequences of its actions that really distinguishes the country’s experience of the post-Covid hangover from elsewhere. And, as with other elements of the pandemic, what happens in Britain tends to happen elsewhere in Europe, with a certain time lag.The first of those economic shocks is already here. Inflation is at 5.2%, its highest since 1992. As a consequence, the Bank of England has already raised its key rate once, by 15 basis points, in December, and is expected by many to raise it again at its meeting on Wednesday.Interest rate hikes may not have quite the dramatic effect on the economy as they once did – too many homeowners now have fixed-rate mortgages for that. But they will still make credit – especially consumer credit – more expensive. This is important now that U.K. consumers, having run down their pandemic-era savings, are again borrowing in large amounts again – despite a six-month run of deteriorating consumer confidence.  After the Bank of England, it will be the turn of the U.K. energy regulator Ofgem. On February 7th, it’s due to announce the new price cap on retail energy bills, which will come into force from April. Given the extraordinary combination of factors that have pushed wholesale market prices higher, this is likely to rise by as much as 50%, adding hundreds of pounds a year to the average household’s energy costs.Ofgem had already raised its price cap by 12% in October.Consumers at least tend to use less energy as spring arrives. However, there will be no avoiding a separate hit in April from the government’s planned tax increases.National insurance contributions, a levy on earned income, are set to rise by 1.25 percentage points from April to fund a new and long-overdue scheme to provide social care for the elderly. Despite a revolt from the low-tax wing of the ruling Conservative Party, who point to better-than-expected government borrowing statistics in recent months, Prime Minister Boris Johnson and his Treasury chief Rishi Sunak wrote at the weekend that they are determined to push it through.The tax on dividend income will also rise by 1.25 points to 33.75% for higher-rate taxpayers.The above combination of factors would test the popularity of any government. In Britain, however, they come on top of damaging revelations about how Johnson and his team partied their way through the pandemic while tens of thousands mourned, sickened and stagnated alone. It may not matter to global markets which of Johnson’s many scandals ultimately bring him down. But it will be an interesting test case for Europeans to see what parts of Johnson’s program gets abandoned and what is kept as the Conservative Party scrambles to keep its 12-year grip on power.    More

Investing.com — The world’s largest oil exporters meet to decide production quotas for March. Whether they can live up to them is another matter. Alphabet (NASDAQ:GOOGL) breathes some life back into tech stocks with strong earnings that set a high bar for Facebook (NASDAQ:FB) owner Meta later Wednesday. ADP reports its monthly private payrolls numbers, and the Eurozone’s inflation problem is getting worse before it gets better. Here’s what you need to know in financial markets on Wednesday, 2nd February.1. Alphabet smashes expectationsGoogle-parent Alphabet delivered a much-needed shot-in-the-arm to technology stocks after the close on Tuesday, reporting strong quarterly results which showed sustained high demand for advertising space on its search and YouTube platforms, as well as for its Cloud-hosting services.Fourth-quarter revenue rose 32% to $75.33 billion, while profit rose by a similar amount. However, revenue growth was the slowest in five quarters, suggesting that the unprecedented pandemic-era boom is fading, while the Cloud business continued to operate at a loss as the company spends heavily on new business.The results nonetheless set a high bar for Facebook owner Meta when it reports after the close. Alphabet stock was up 10.2% in premarket, making up all of its January losses.2. OPEC+ to meet; U.S. inventories dueThe world’s largest oil exporters meet to set production quotas for March, and the meeting is likely to end in disappointment for those hoping for a faster rise in supply.Analysts expect the Organization of Petroleum Exporting Countries and allies led by Russia to stick to their regular monthly increase of 400,000 barrels a day – albeit, the group has failed to meet even that target in recent months, leaving its collective output over half a million b/d below where it ought to be. Russia missed its output quota for the second straight month in January, analysis of data published on Tuesday suggests.OPEC ministers will convene at 7 AM ET (1200 GMT) and take a common position into their meeting with non-OPEC producers at 8 AM ET. They should be finished by the time the U.S. releases weekly inventory numbers at 10:30 AM ET.Crude futures were flat ahead of the meeting, still close to seven-year highs. U.S. crude futures were at $88.20 a barrel, while Brent was at $89.06 a barrel. 3. Stocks set to open higher; earnings barrage continues U.S. stock markets are set to open higher later, as Alphabet’s earnings restore a bit of confidence in the outlook for tech – even though the dominant status (and the pricing power) that it commands in its core businesses aren’t something that really applies to most other stocks in the sector.By 6:20 AM ET, Dow Jones futures were up 36 points, or 0.1%, while S&P 500 futures were up 0.6% and NASDAQ 100 futures were up by a thumping 1.3%.Other stocks likely to be in focus later include Starbucks (NASDAQ:SBUX), PayPal (NASDAQ:PYPL) and Advanced Micro Devices (NASDAQ:AMD), which all also reported late on Tuesday – the former two disappointing with their guidance and the latter beating expectations. AbbVie (NYSE:ABBV), Thermo Fisher (NYSE:TMO), DR Horton (NYSE:DHI) and Humana (NYSE:HUM) all report later, along with Boston Scientific (NYSE:BSX), Waste Management (NYSE:WM) and Emerson (NYSE:EMR). Qualcomm (NASDAQ:QCOM) and T-Mobile lead the roster of late updates.4. Eurozone inflation surprises with new record highInflation in the Eurozone rose surprisingly to a new all-time record high of 5.1%, as skyrocketing energy prices prevented the expected drop from materializing.Money markets reacted by bringing forward their expectations of the European Central Bank’s first interest rate hike in 11 years to July, something that is still firmly at odds with ECB guidance, while the euro rose to its highest in a week at $1.1312.  The numbers follow data earlier this week showing that the Eurozone unemployment rate is also at a record low of 7.0%.The benchmark 10-Year German bond yield rose to its highest since May 2019 on the news, at 0.05%.5. ADP payrolls seen hit by OmicronThe U.S. labor market is in focus later, with ADP’s monthly assessment of private payrolls in January.It may be harder than usual to distinguish noise from signal in this week’s data: the White House on Tuesday dropped a heavy hint that it expects a very weak number for payroll growth on Friday due to the impact of the wave of Omicron-variant Covid-19 during the month.Analysts expect the ADP number to come in at 207,000, down from 807,000 in December.Despite that, other data points continue to suggest the labor market remains tight. U.S. job openings rose again in January to close to their all-time high, according to the monthly JOLTS survey released on Tuesday. More