Guernsey’s economy experienced a healthy level of growth in 2017 with GDP increasing by 2% in real terms, according to data recently published in the Guernsey Economic Overview.
The report brings together a range of statistics published by the States of Guernsey and the Guernsey Financial Services Commission to provide an overview of current economic conditions.
Data for 2017 shows that strong growth boosted government revenues and led to a return of net immigration in to Guernsey. After a period of net emigration, there was a net inward movement of 200 people moving to Guernsey during 2017.
Other data suggests that economic growth has continued in 2018 and that Guernsey’s economy has followed a similar path to the UK. Total employment in Guernsey continued to grow in June 2018, although the rate at which the workforce is growing has slowed. The increase in median earnings in June 2018, which had been lagging price inflation, was slightly more than RPIX.
In the property market, the average price of local market property continues to fall in real terms, but the volume of transactions taking place has increased. The third quarter of 2018 saw 251 local market transactions take place; only the second time more than 250 transactions have taken place in a three-month period since 2007. Properties are also, on average, spending less time on the market before a sale is completed and are selling at a smaller discount from the first advertised price than at the same time last year.
The increase in property sales also seems to be driving an increase in construction activity. After a period of contraction, employment data now shows three successive quarters of year-on-year employment growth in the sector by June 2018.
The finance sector was the principal driver of GDP growth in 2017. There has been a slight decrease in the number of people employed in the sector in the year ending June 2018, however conditions remain stable.
Looking forward, the OECD forecasts a slowing of global economic growth through 2019 and the expectation is that the local economy will follow a similar path. The 2019 Budget was prepared on the assumption that economic conditions may soften in 2019 but that a modest level of economic growth will continue.