For several years, now, this column has referred to the output gap as an “intellectual conceit”. Given the ferocity of the credit crunch, the UK has lost enormous productive capacity, as firms have closed, workforces have dispersed and some companies, in a desperate bid to survive, have been forced to flog their capital goods to overseas buyers. And while unemployment in the UK is quite high, a large rump of our jobless are, given their lack of skills, sadly unemployable.