Global Talent Update -- February 2018
Europe, Middle East and Africa
In a year of significant transition and upheaval for France, effects on the country’s economy were to be expected. Fortunately for new French president Emmanuel Macron, most of them were positive. According to the Financial Tribune, France's national deficit came in at 67.8 billion euro, an improvement of $1.3 billion from the previous year and better than the outgoing administration's past prediction of a 69.3 billion euro deficit.
Final economic metrics for 2017 have yet to be released, but French Economy and Finance Minister Bruno Le Maire stated his prediction of 2 per cent economic growth for the year, a positive revision from previous estimates of 1.7 per cent expansion. Le Maire also confirmed the French government's five-year plan for unemployment reduction, with the hope of slashing this figure from its current level of 9.4 per cent to 7 per cent by 2022. To bolster these efforts, RFI reported that President Macron recently organized a meeting of 140 CEOs from major corporations around the globe, urging them to bring operations to France.
While slightly less than what was recorded in the previous year, Israel did see economic growth in 2017. According to figures from the Central Bureau of Statistics, gross domestic product rose 3.0 per cent, and per capita GDP saw a 1.9 per cent uptick. (Identical growth was seen in 2016 GDP per capita, but 4 per cent expansion in overall GDP.) Private consumer spending in Israel also saw growth not quite up to the prior year's standards, with 3 per cent growth for 2017 as opposed to 6.1 per cent in 2016.
More broadly, Israel is in a strong position for the foreseeable future. The Israeli debt-to-GDP ratio has fallen steadily since 2008, when it was 70.8 per cent, and was most recently measured at 60.6 per cent. Strong performances on the stock market by major companies in the nation and a number of partnerships with India - specifically in the fields of irrigation solutions and other agricultural technologies - are also contributing positively to Israel's economic well-being.
For the past several years, currency deflation has prevented the Japanese economy from growing at a pace that would please its leaders and citizens. Nevertheless, the latest assessment of Japan's markets and labor force from the administration of Prime Minister Shinzo Abe seem to indicate a positive movement for the country in early 2018 and beyond, on the heels of increased consumer expenditures and consumption. According to The Japan Times, the Cabinet Office declared that the country's economy was "recovering at a moderate pace."
"With consumption picking up, improvements have been spreading (beyond the corporate sector) to households. This led to the upward revision," the Office's statement continued, the latter phrase referencing its previous characterizations of the Japanese economic recovery, which were much less robust. PM Abe has expressed hope that businesses will follow his recommendation of raising wages by 3 per cent, which would further motivate consumer spending.
Meanwhile, Forbes noted that while Japan's overall economic outlook should be positive, factors such as the possibility of conflict with North Korea, the upcoming election (which Abe is expected to win) and possible regime change at the Bank of Japan should not be ignored by domestic and foreign participants in the Japanese economy.
Undeniable positive developments occurred across Thailand's economy during 2017. These include a predicted 3.8 per cent increase in GDP and export growth of 9.3 per cent (though these numbers have yet to be statistically finalized). Export growth is also predicted to continue at a diminished rate of 4 per cent - still a relatively strong figure, but nonetheless a two-fold reduction. According to Bloomberg, further GDP growth is still likely during 2018 and the next few years to follow, but it will occur at a more modest pace. Rahul Bajoria, a Singapore-based economist for Barclays, cited manufacturing as one of the few less positive aspects of the Thai economy.
"2017 and 2018 will certainly be better compared to the last few years, but the underperformance of the industrial sector, particularly manufacturing, will likely continue," Bajoria told the news provider. "What's really missing here is the lack of private investment before we see growth closer to 5 per cent."
A major bright spot for Thailand in the immediate future is the strength of its currency. The advance in value of the baht, which shot up 9 per cent, significantly outpaced the performance of most other monies throughout the Asia-Pacific region. Additionally, the tourism sector, which has always been a stalwart producer for the Thai economy, is predicted to stay strong through 2018 and drive overall economic growth for the year as high as 4.6 per cent.
Although the U.S. saw only moderate job growth in December 2017 - with 148,000 jobs added, below economists' projection of 190,000 positions - the pace of expansion didn't slow enough to change the essentially positive direction of the American job market. Throughout 2017, the unemployment rate trended continuously downward, from 4.8 per cent in January to 4.1 per cent in November, and aside from isolated periods like September, which saw job losses in the aftermath of hurricanes' impact on the southeastern U.S., most months saw notable job creation.
Healthcare, construction and manufacturing, fields of employment that contributed significantly to U.S. job growth for much or all of the past year, continued their positive trends in December. While little to nothing is certain in global economics, those sectors' progress suggests a strong possibility of further expansion during 2018. Retail trade was the only major job market to experience notable decline in 2017, losing 20,000 jobs in December and 67,000 positions over the course of the year.
Average wages grew in the U.S. during most of 2017, including in December, but at a slower pace than economists would have expected given the high rate of job creation. Hourly earnings increased by 9 cents last month, and rose 65 cents over the course of the year for a growth rate of 2.5 per cent.
According to results of the latest Labour Force Survey by Statistics Canada, unemployment throughout all of Canada fell to 5.7 per cent in December 2017, the lowest level recorded since 1976. This served as a capstone to a quarter of unbridled growth for the Canadian job market. The economy added jobs for all three of 2017's final months, with 79,000 positions created in December.
Finance, insurance and real estate - which are categorized as a single sector by the Canadian government - provided the bulk of this job growth, adding 25,000 jobs in December despite having little growth or contraction throughout the year.
News of the nation's job growth - which took economists surveyed by Reuters by surprise, as they expected only 1,000 jobs added in December 2017 - drove positive movement in a number of other Canadian economic indicators. The Canadian dollar rose to C$1.24 per U.S. dollar, the two-year bond yield rate reached approximately 1.79 per cent and export shipments increased by 3.7 per cent.
Research compiled by Statista found that after several years of relative stagnation in the early 2010s, Mexico's unemployment rate began dropping in 2014 and has continued to fall ever since. Another year of decline took place in 2017 for Mexican unemployment, with this metric coming in at about 3.6 per cent for the year - down from just under 3.9 per cent in 2016. Some fluctuation in the Mexican job market is projected for the years to follow, with the number predicted to hit 3.5 per cent by 2022.
The nation's economy is not without its difficulties, with Reuters noting a slight decline (0.24 per cent) in the peso just before 2018 began. That said, according to a recent public statement by Geronimo Gutierrez, Mexico's ambassador to the U.S., renegotiation talks regarding the North American Free Trade Agreement are progressing positively, which could be good news for Mexican workers in the near future.