Recession Repercussions

Data from Timetric.

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A recession is defined as a period of general economic decline, typically indicated by a fall in GDP for two or more consecutive quarters. Everyone’s still feeling the effects of the recession that began back in December 2007. The latest statistics show some of the consequences we now face.

Data from Timetric.

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Total consumption has taken a hit since the recession. This has great relevance, as consumption is a large (if not largest) component of GDP, the leading measure of the success of an economy. This is partially due to increased unemployment – but hopefully, with the unemployment rate stabilising, consumption may begin to pick back up again in the near future.

Data from Timetric.

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Looking at tourism, there was a steep drop in net consumption (exports minus imports) during the recession. What this means, in part, is that UK holiday goers have been staying within the UK to relax (and pray for sunshine). Even the new Prime Minister went to Cornwall for his summer holiday — at least, before it was interrupted! For UK holiday destinations, this is good news. For example, Lincolnshire’s tourism industry recovered over the last year. As tourism is the second biggest component of the economy, this is a (rare) shard of light.

Data from Timetric.

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Production took a huge hit during the recession, resulting in unemployment, factory closures and bankruptcies. However, UK manufacturing is finally beginning to recover – another indicator that the recovery is in process.

Data from Timetric.

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This shows the severe drop in the balance of trade throughout the recession. An improved balance of trade is good news, certainly; but it’s important to remember that it’s a symptom, rather than a cause, of the recovery.

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“Not in education and training”: the young, the male, the unemployed.

Unemployment is all around us – it’s at its highest level for a decade. However, the latest UK unemployment statistics are indicating that the darkest may be behind us.

Data from Timetric.

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Evidently, as we’ve said, unemployment is high at present. However there is reason for cautious optimism: the number of unemployed people has fallen over the past few months. This is the first occurrence of this since the recession, and is a small step in the right direction.

Data from Timetric.

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Youngsters have been hit hardest – work becoming more scarce than a purple gem. This has been compounded by the cutback in university places. Being 17 myself, it’s not been the most reassuring news to hear as I sit my A levels and decide what path to take in my future! Many others in my position have decided to give up on it all as a result. I’m not throwing in the towel so easily, however.

Data from Timetric.

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The current recession has been called the “mancession”: men have been hit disproportionately hard, due mostly to male-dominated fields such as construction and manufacturing being worst affected by the downturn.

Data from Timetric.

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The employed are even having problems of their own. There’s been the first drop in average wages in decades. Wages in the public sector have been frozen; inflation on basic staples such as bread and eggs, as well as on necessities like petrol and oil, has made these workers very worried.

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