> The UK will face one of the worst recessions and weakest recoveries in the G7 in the coming year, as households pay a heavy price for the government’s policy failings, economists say.
> A clear majority of the 101 respondents in the FT’s annual poll of leading UK-based economists said the inflationary shock caused by the pandemic and the Ukraine war would persist for longer in the UK than elsewhere, forcing the Bank of England to keep interest rates high and the government to run a tight fiscal policy.
> More than four-fifths expected the UK to lag its peers, with GDP already shrinking and set to do so for much or all of 2023.
> The result is expected to be an intensifying squeeze on household incomes, as higher borrowing costs add to the pain already caused by soaring food and energy prices.
> “The 2023 recession will feel much worse than the economic impact of the pandemic,” said John Philpott, an independent labour market economist. Others described the outlook for consumers — especially those on low incomes or mortgage deals that were set to expire — as “tough”, “bleak”, “grim”, “miserable” and “terrible”.
> “The combination of falling real wages, tight financial conditions and a housing market correction are as bad as it gets,” said Kallum Pickering, senior economist at Berenberg bank.
> The UK is not alone in facing these challenges: Kristalina Georgieva, the IMF managing director, warned at the weekend that a third of the global economy and half of the EU would be hit by recession this year.
> Most economists said the economy would at least return to growth by the end of the year as inflation ebbs, with Paul Dales, at the consultancy Capital Economics, asserting: “2024 will be much better than 2023.”
> But Britain’s downturn looks set to be both deeper and more prolonged. Forecasts compiled by Consensus Economics show UK GDP shrinking by 1 per cent in 2023, compared with a contraction of just 0.1 per cent for the eurozone as a whole and growth of 0.25 per cent in the US.
> The UK is unusually exposed to the global surge n energy prices and interest rates — with a reliance on gas that is not matched by storage capacity, and a high proportion of mortgage obliged to renew fixed-rate deals in any given year.
> The UK is also unusual in the extent to which its workforce has shrunk since the pandemic. Charlie Bean, a former BOE chief economist, said high inflation was likely to be more persistent in the UK than elsewhere, because its labour market was “unsustainably tight even in the absence of the Ukraine shock”. Anna Leach, deputy chief economist at the CBI, said this would “continue to apply a brake to growth for companies, drive industrial unrest and push up domestically-generated inflation”.
> “The UK suffers from an energy shock as bad as Europe’s, an inflation problem . . . as bad as the US and a unique problem of lack of labour supply from the combination of Brexit and the NHS crisis,” said Ricardo Reis, a professor at the London School of Economics.
> But even once the recovery was under way, most said Britain would continue to lag because of fundamental problems that policy mistakes had made worse — poor productivity, weak business investment, government neglect of public services and the damage to trade done by Brexit.
> “The UK is in a structural hole, not a cyclical downturn,” said Diane Coyle, professor at Cambridge university, who saw little prospect of an improvement in living standards “unless some sanity returns to our trade relations with the EU” and “until we have a government with an adequately long-term economic strategy it can get through parliament”.
Cont. below
All the more reason to remove the tories as soon as possible, they are only making things 10 times worst with their maliciousness.
I could actually weep at this point. There’s the small scale day to day worries this throws up, but then there’s all the grand world stage stuff. How have we let this happen? We’re Great Britain. In the 2000s we used to be one of the powerhouses of the European economy. Now we’re barely able to run our public services let alone have a growing economy and rising living standards.
Countries like Poland and Slovenia are forecast to overtake us on median living standards. Germany, France, Ireland and the US have long since left us behind.
The UKs long-term problem of poor productivity and business investment raises its ugly head yet again – the problem has always had its head raised, consecutive governments, the CBI etc. just always ignore it and businesses are only interested in banking profits and paying out to shareholders rather than investing in new technology and processes.
The CBI have already made their move with a demand for more free movement of labour, which will resolve the tight labour market and kick start growth to some extent but the economy will only grow by adding more people and per capita growth will lag and the same problems of rising poverty and inequality that has been with us since 2006 will continue.
What we need are policies that will encourage business to invest, raise productivity and with it raise wages. A correction in the housing market wouldn’t hurt either.
Fuck all chance of that happening with the current Tory shitshow.
But remember it’s not Brexit’s fault nor is it the fault of the party which has stolen billions from the taxpayer.
No, no it’s clearly the fault of COVID it made the Tories and their backers steal from us after the EU unleashed it upon the world.
That and all those people who didn’t want to leave the EU how dare they not support the thing they voted against!
Thanks to the Tories and the plebs who vote for them 👌
Interestingly, King Charles is one of the richest man in the world.
Have folk considered the implications of Scotland being independent on England’s progress in the world?
I may only be 22, yet the downfall that I have witnessed, in my lifetime, has been staggering. I can remember Cameron getting into Downing Street, moments after Brown had left back in 2010. I vividly remember my mother sobbing saying how they (Conservatives) would ruin the county, and that we all would be much worse off.
While I had no clear comprehension of what that meant historically at the time, it’s sure hit reality now.
What have they achieved?
Soaring cost of living (house prices, food, utilities, etc.), polarisation of British politics, complete isolation from the European political and economic system, mass privatisation, and the list goes on and on.
Despite my senses telling me that even under this shambles, the Tories will find a way back, I can’t imagine why anyone of rational mind would vote for these lot within the next two decades.
“flat-earther policy-making” nailed it. That is it. Sums it all up. It’s funny cause it’s true.
It’s probably because we’re going through 3 recessions on top of each other. First Brexit, then the disease we can’t mention and now the oil crisis thanks to the Ukraine war and the government just doesn’t give a shit
that would possibly be because you are being governed by extremists who having left the largest trade block on earth and found that they cannot find any trade deals which are worth anything like what they had in the eu,know that if they admitted that what they’ve been saying for the past 50 years is wrong it would destroy the tory party.
Well that’s what happens when politicians convince people that sanctioning themselves is a good thing.
Let’s just keep pretending that voting in labour would (somehow) be worse. Let’s keep letting Tory’s detract from every single question with some nonsense sound bites, like an insta PT saying “pain is weakness leaving the body” when you break your back because you followed their shit instructions. Let’s allow them to freedom to make claims that they have done anything good over the last decade without them providing evidence or experiencing the consequences of their lies. Let’s keep arguing with each other over our leaders poor decision-making and actions instead of holding them accountable. Let’s promote whataboutism and gaslighting bullshit. “Yeah but Starmer ate a curry”, “I just don’t like Corbyn”.
I can’t believe you are all arguing about getting the tories out and labour will be our saviours. Boy we have a loooooong way to go. When will people realise they are all on the same side and that we are irrelevant to them, they despise us all. Not one MP is there for us, ever! They give us crumbs and you fall at their feet. U.K. voting system sucks, they have it sewn up so we can’t change anything. We vote to keep the other parties out, not for who has our best interests or wants our country to succeed. Voting is a pointless task, we all suffer regardless.
But we can’t do or say anything about it because then the people who have been lied to for decades by the same billionaires who are destroying the country won’t vote for us.
‘say economists’ ahhh those bunch again, you know, the ones that are correct all the time.
Would these ‘economists’ happen to be experts in the economy? I think we decided some years ago we had enough of experts.
/s
Surprise surprise when you strip everywhere if economic activity except for one financial centre backed by a fiat currency backed by another country’s fiat currency, when that bigger country’s currency plummets in value your entire economy goes down the drain. 80 years of mismanagement coming home to roost.
Probably why UK is shaping up to deregulate the banks further… so instead of 2008 x5 we’re going to have 2008 x100!
It’s actually quite simple. England is no longer able to strip the colonies for their assets in order to fund it’s own growth/ bail it out.
We have the worst negotiators in our elected government making deals with the rest of the world on our behalf, a long term strategy that only benefits shareholders and CEO’s.
Our debt payment model relies on decreasing growth even further, squeezing the working and middle class even more to make up for the short sighted Brexit disaster and sitting idle whilst national services crumble in realtime.
Whilst all this is going on, the geniuses in government decided to make this country as unappealing as possible to highly skilled migrants in the health and tech sectors – ‘**Come to England where we’ll tax the living hell out of you whilst you earn comparatively less for working more hours**’
It’s not just the government that created this mess, its the braindead nationalists that haven’t got a clue that they, their kids, generations to come are the ones that are suffering the most.
Sure it is because of the war in Ukraine and not the shit policies here
Breaking news: Self imposed economic sanctions are bad.
That’s because the UK is the only G7 nation to increase barriers to trade (Brexit).
Oh my god, it’s a mirage; I’m telling y’all it’s sabotage
We spend more time in recession than out in a tory government yet they’re the best custodians of the economy lmao.
Socially liberal, fiscally Conservative = big ol wanker cunt.
Can you guys plunder your royals while you wait to get the Tories out? They seem to be doing okay
How does the UK want to be competitive with such taxes?
After all, it will be soon that anyone who can do more than carry packages in a warehouse will leave because it won’t be worth their while to work.
28 comments
(1) Or [archive.is](https://archive.is/7HKOm) link
> The UK will face one of the worst recessions and weakest recoveries in the G7 in the coming year, as households pay a heavy price for the government’s policy failings, economists say.
> A clear majority of the 101 respondents in the FT’s annual poll of leading UK-based economists said the inflationary shock caused by the pandemic and the Ukraine war would persist for longer in the UK than elsewhere, forcing the Bank of England to keep interest rates high and the government to run a tight fiscal policy.
> More than four-fifths expected the UK to lag its peers, with GDP already shrinking and set to do so for much or all of 2023.
> The result is expected to be an intensifying squeeze on household incomes, as higher borrowing costs add to the pain already caused by soaring food and energy prices.
> “The 2023 recession will feel much worse than the economic impact of the pandemic,” said John Philpott, an independent labour market economist. Others described the outlook for consumers — especially those on low incomes or mortgage deals that were set to expire — as “tough”, “bleak”, “grim”, “miserable” and “terrible”.
> “The combination of falling real wages, tight financial conditions and a housing market correction are as bad as it gets,” said Kallum Pickering, senior economist at Berenberg bank.
> The UK is not alone in facing these challenges: Kristalina Georgieva, the IMF managing director, warned at the weekend that a third of the global economy and half of the EU would be hit by recession this year.
> Most economists said the economy would at least return to growth by the end of the year as inflation ebbs, with Paul Dales, at the consultancy Capital Economics, asserting: “2024 will be much better than 2023.”
> But Britain’s downturn looks set to be both deeper and more prolonged. Forecasts compiled by Consensus Economics show UK GDP shrinking by 1 per cent in 2023, compared with a contraction of just 0.1 per cent for the eurozone as a whole and growth of 0.25 per cent in the US.
> The UK is unusually exposed to the global surge n energy prices and interest rates — with a reliance on gas that is not matched by storage capacity, and a high proportion of mortgage obliged to renew fixed-rate deals in any given year.
> The UK is also unusual in the extent to which its workforce has shrunk since the pandemic. Charlie Bean, a former BOE chief economist, said high inflation was likely to be more persistent in the UK than elsewhere, because its labour market was “unsustainably tight even in the absence of the Ukraine shock”. Anna Leach, deputy chief economist at the CBI, said this would “continue to apply a brake to growth for companies, drive industrial unrest and push up domestically-generated inflation”.
> “The UK suffers from an energy shock as bad as Europe’s, an inflation problem . . . as bad as the US and a unique problem of lack of labour supply from the combination of Brexit and the NHS crisis,” said Ricardo Reis, a professor at the London School of Economics.
> But even once the recovery was under way, most said Britain would continue to lag because of fundamental problems that policy mistakes had made worse — poor productivity, weak business investment, government neglect of public services and the damage to trade done by Brexit.
> “The UK is in a structural hole, not a cyclical downturn,” said Diane Coyle, professor at Cambridge university, who saw little prospect of an improvement in living standards “unless some sanity returns to our trade relations with the EU” and “until we have a government with an adequately long-term economic strategy it can get through parliament”.
Cont. below
All the more reason to remove the tories as soon as possible, they are only making things 10 times worst with their maliciousness.
I could actually weep at this point. There’s the small scale day to day worries this throws up, but then there’s all the grand world stage stuff. How have we let this happen? We’re Great Britain. In the 2000s we used to be one of the powerhouses of the European economy. Now we’re barely able to run our public services let alone have a growing economy and rising living standards.
Countries like Poland and Slovenia are forecast to overtake us on median living standards. Germany, France, Ireland and the US have long since left us behind.
The UKs long-term problem of poor productivity and business investment raises its ugly head yet again – the problem has always had its head raised, consecutive governments, the CBI etc. just always ignore it and businesses are only interested in banking profits and paying out to shareholders rather than investing in new technology and processes.
The CBI have already made their move with a demand for more free movement of labour, which will resolve the tight labour market and kick start growth to some extent but the economy will only grow by adding more people and per capita growth will lag and the same problems of rising poverty and inequality that has been with us since 2006 will continue.
What we need are policies that will encourage business to invest, raise productivity and with it raise wages. A correction in the housing market wouldn’t hurt either.
Fuck all chance of that happening with the current Tory shitshow.
But remember it’s not Brexit’s fault nor is it the fault of the party which has stolen billions from the taxpayer.
No, no it’s clearly the fault of COVID it made the Tories and their backers steal from us after the EU unleashed it upon the world.
That and all those people who didn’t want to leave the EU how dare they not support the thing they voted against!
Thanks to the Tories and the plebs who vote for them 👌
Interestingly, King Charles is one of the richest man in the world.
Have folk considered the implications of Scotland being independent on England’s progress in the world?
I may only be 22, yet the downfall that I have witnessed, in my lifetime, has been staggering. I can remember Cameron getting into Downing Street, moments after Brown had left back in 2010. I vividly remember my mother sobbing saying how they (Conservatives) would ruin the county, and that we all would be much worse off.
While I had no clear comprehension of what that meant historically at the time, it’s sure hit reality now.
What have they achieved?
Soaring cost of living (house prices, food, utilities, etc.), polarisation of British politics, complete isolation from the European political and economic system, mass privatisation, and the list goes on and on.
Despite my senses telling me that even under this shambles, the Tories will find a way back, I can’t imagine why anyone of rational mind would vote for these lot within the next two decades.
“flat-earther policy-making” nailed it. That is it. Sums it all up. It’s funny cause it’s true.
It’s probably because we’re going through 3 recessions on top of each other. First Brexit, then the disease we can’t mention and now the oil crisis thanks to the Ukraine war and the government just doesn’t give a shit
that would possibly be because you are being governed by extremists who having left the largest trade block on earth and found that they cannot find any trade deals which are worth anything like what they had in the eu,know that if they admitted that what they’ve been saying for the past 50 years is wrong it would destroy the tory party.
Well that’s what happens when politicians convince people that sanctioning themselves is a good thing.
Let’s just keep pretending that voting in labour would (somehow) be worse. Let’s keep letting Tory’s detract from every single question with some nonsense sound bites, like an insta PT saying “pain is weakness leaving the body” when you break your back because you followed their shit instructions. Let’s allow them to freedom to make claims that they have done anything good over the last decade without them providing evidence or experiencing the consequences of their lies. Let’s keep arguing with each other over our leaders poor decision-making and actions instead of holding them accountable. Let’s promote whataboutism and gaslighting bullshit. “Yeah but Starmer ate a curry”, “I just don’t like Corbyn”.
I can’t believe you are all arguing about getting the tories out and labour will be our saviours. Boy we have a loooooong way to go. When will people realise they are all on the same side and that we are irrelevant to them, they despise us all. Not one MP is there for us, ever! They give us crumbs and you fall at their feet. U.K. voting system sucks, they have it sewn up so we can’t change anything. We vote to keep the other parties out, not for who has our best interests or wants our country to succeed. Voting is a pointless task, we all suffer regardless.
But we can’t do or say anything about it because then the people who have been lied to for decades by the same billionaires who are destroying the country won’t vote for us.
‘say economists’ ahhh those bunch again, you know, the ones that are correct all the time.
Would these ‘economists’ happen to be experts in the economy? I think we decided some years ago we had enough of experts.
/s
Surprise surprise when you strip everywhere if economic activity except for one financial centre backed by a fiat currency backed by another country’s fiat currency, when that bigger country’s currency plummets in value your entire economy goes down the drain. 80 years of mismanagement coming home to roost.
Probably why UK is shaping up to deregulate the banks further… so instead of 2008 x5 we’re going to have 2008 x100!
It’s actually quite simple. England is no longer able to strip the colonies for their assets in order to fund it’s own growth/ bail it out.
We have the worst negotiators in our elected government making deals with the rest of the world on our behalf, a long term strategy that only benefits shareholders and CEO’s.
Our debt payment model relies on decreasing growth even further, squeezing the working and middle class even more to make up for the short sighted Brexit disaster and sitting idle whilst national services crumble in realtime.
Whilst all this is going on, the geniuses in government decided to make this country as unappealing as possible to highly skilled migrants in the health and tech sectors – ‘**Come to England where we’ll tax the living hell out of you whilst you earn comparatively less for working more hours**’
It’s not just the government that created this mess, its the braindead nationalists that haven’t got a clue that they, their kids, generations to come are the ones that are suffering the most.
Sure it is because of the war in Ukraine and not the shit policies here
Breaking news: Self imposed economic sanctions are bad.
That’s because the UK is the only G7 nation to increase barriers to trade (Brexit).
Oh my god, it’s a mirage; I’m telling y’all it’s sabotage
We spend more time in recession than out in a tory government yet they’re the best custodians of the economy lmao.
Socially liberal, fiscally Conservative = big ol wanker cunt.
Can you guys plunder your royals while you wait to get the Tories out? They seem to be doing okay
How does the UK want to be competitive with such taxes?
After all, it will be soon that anyone who can do more than carry packages in a warehouse will leave because it won’t be worth their while to work.
Just take a look at that, and compare it to the UK:
https://www.workinestonia.com/working-in-estonia/taxes/