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Wednesday, Aug 26, 2026

Financial chiefs attending Starmer speech is significant - they can see which way the wind is blowing

Financial chiefs attending Starmer speech is significant - they can see which way the wind is blowing

The head of the CBI, leading chief executives and other prominent economists (including, via videolink, former Bank of England governor Mark Carney) all turned up - they did so because in much the same way as their predecessors did in 2009, they can see which way the wind is blowing.

Let's get the policy stuff out of the way first.

Labour has an economic growth target.

They want to achieve the highest sustainable growth per head rate of the seven major industrialised economies. They say that unless we do something to change the path of British economic growth we will end up poorer than Poland by 2030.

That last fact, one reiterated by Sir Keir Starmer today, probably sounds quite horrifying, but it's not quite what it seems.

Not that it's incorrect: it's certainly borne out by the numbers.

As of 2021, the UK's gross domestic product per capita was just under $45,000 (£37,000).

That compares to just under $35,000 (£29,000) in Poland (the numbers here are adjusted to account for how far your money goes in each country, something called purchasing power parity).

Extrapolate the growth rates from the past decade forward (the UK's is low at 0.7%, Poland's is high at 3.4%) and by 2030 Poland's GDP per capita is $48,000 (£40,000) and the UK's is $47,700 (£39,700).

But the UK is hardly an outlier. On the basis of this thought experiment, Poland would also be richer, in GDP per capita terms, than Japan, France and Italy by 2030.

It rather underlines the point that while the UK's recent economic performance is certainly poor, it is far from an outlier. And that these statistical thought experiments only go so far.

Mark Carney, the former governor of the Bank of England, watches via videolink as Sir Keir Starmer (second right) details his party's growth mission


Consider: let's imagine that the UK had gone far beyond Labour's new economic pledge in recent years.

Let's imagine it had matched the strongest GDP per capita growth in the group of seven industrialised economies (UK, US, Japan, Canada, Italy, France, Germany) not just for two successive years (as the small print to this new pledge says) but for ten successive years.

That would be a massive achievement.

Britain has only had the strongest GDP per capita growth rate for a handful of years going back recent decades. But here's the thing: even if you extrapolated this stronger growth rate (2% on average over the past decade) forward, things would still look a bit depressing vis-à-vis Poland. Our imaginary fastest-in-the-G7 UK would still be overtaken by Poland by 2037.

Anyway, tearing too deep into statistical nuggets like these invariably ends with a reductio ad absurdum.

Nor is there much point in getting too het up about the fact that Labour has yet to provide much detail on how it will actually achieve this very ambitious goal (it hasn't). No one would expect the opposition to provide detailed, solid manifesto pledges quite so far from the next election.

Perhaps the most interesting dimension of today's economic event is something else: the vibe.

I can remember how, in 2009 and early 2010, something shifted in the political landscape.

The Labour Party were on the way out and the Tories were on the way in, and all of a sudden you started to spot the great and the good at Conservative events.

Today felt similar.

The head of the Confederation of British Industry, leading chief executives and other prominent economists (including, via videolink, former Bank of England governor Mark Carney) all turned up for a Labour event.

They did so because in much the same way as their predecessors did in 2009, they can see which way the wind is blowing. They aren't bothered about pledges like the one about economic growth.

They care about the fact that these people may soon be in government.

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