Thomas Molloy: Still troubled times as we spend more, but have less
Good spending creates local jobs while not-so-good spending goes on imports, creating jobs overseas
THERE were two seemingly contradictory bits of economic data yesterday. The first showed that people are spending more in the nation's shops and car dealerships than they have done for some time. The second piece of data revealed a third of people are struggling to pay their bills: twice as many as this time last year.
How can people be spending more when they have less money? There are two possible explanations. The first is that the recession is beating up those who have lost their jobs while deflation is rewarding those who remain in employment with cheaper meals, holidays and consumer goods. The other explanation is that people are still recklessly buying and have failed to reduce their spending enough to stay out of debt. The truth is probably somewhere between these two explanations but either way there are few reasons to celebrate.