Changes in exchange rates can have a big effect on jobs in different industries. Here’s how it works:
Industries that Export: When the money a country uses gets weaker (like when £1 used to be 1.10), it makes products cheaper for buyers from other countries. This can help boost sales and maybe even create more jobs. For example, if the currency drops by 10%, the amount of products exported can go up by about 5%.
Industries that Depend on Imports: On the other hand, industries that rely on buying goods from other countries might find that it costs them more when their currency weakens. A 10% drop in currency value can make imports cost up to 10% more, which could result in job cuts.
Job Numbers: According to the Office for National Statistics, when demand for exports goes up by 1%, jobs in export businesses can increase by about 0.23%.
In summary, while changes in exchange rates can create jobs in export industries, they can also threaten jobs in industries that rely on imports.
Changes in exchange rates can have a big effect on jobs in different industries. Here’s how it works:
Industries that Export: When the money a country uses gets weaker (like when £1 used to be 1.10), it makes products cheaper for buyers from other countries. This can help boost sales and maybe even create more jobs. For example, if the currency drops by 10%, the amount of products exported can go up by about 5%.
Industries that Depend on Imports: On the other hand, industries that rely on buying goods from other countries might find that it costs them more when their currency weakens. A 10% drop in currency value can make imports cost up to 10% more, which could result in job cuts.
Job Numbers: According to the Office for National Statistics, when demand for exports goes up by 1%, jobs in export businesses can increase by about 0.23%.
In summary, while changes in exchange rates can create jobs in export industries, they can also threaten jobs in industries that rely on imports.