{"id":173054,"date":"2025-08-25T01:00:10","date_gmt":"2025-08-25T01:00:10","guid":{"rendered":"https:\/\/www.europesays.com\/us\/173054\/"},"modified":"2025-08-25T01:00:10","modified_gmt":"2025-08-25T01:00:10","slug":"uk-faces-acute-challenge-from-weak-growth-and-shrinking-workforce-says-andrew-bailey-andrew-bailey","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/us\/173054\/","title":{"rendered":"UK faces \u2018acute challenge\u2019 from weak growth and shrinking workforce, says Andrew Bailey | Andrew Bailey"},"content":{"rendered":"

Britain faces an \u201cacute challenge\u201d from its weak underlying economic growth and a drop in the number of workers since the pandemic, according to the Bank of England<\/a> governor, Andrew Bailey.<\/p>\n

A rise in the number of people defined as long-term sick and a big drop in young people in work \u2013 factors that he suggested might be intertwined \u2013 added to the squeeze created by an ageing population.<\/p>\n

This increased the need for efforts to boost economic productivity, Bailey told the gathering of leading policymakers in Jackson Hole, Wyoming, at the weekend.<\/p>\n

The emphasis needed to be on raising productivity growth, Bailey said. \u201cAgeing is not going to turn around in the foreseeable future.\u201d By 2040, 40 per cent of the UK population will be older than 64, he added.<\/p>\n

He said the Bank of England<\/a> had turned its focus away from long-term trends in unemployment to look instead at levels of labour force participation.<\/p>\n

Official data shows that the percentage of 16- 64-year-olds active in Britain\u2019s labour market is lower than before the Covid-19 pandemic, unlike in other advanced economies. Mental health was the most common reason for being inactive, a point he described as \u201ca very concerning development\u201d.<\/p>\n

Bailey added that there were caveats around the data, including a low response rate and the possibility that the economically inactive might be more likely to take part in official surveys.<\/p>\n

But he did not think this factor explained all the decline. \u201cData caveats aside, this is a pretty sad story for the UK because \u2026 we are well at the bottom of the league table,\u201d he said.<\/p>\n

The government has pledged to boost labour force participation and economic growth, but earlier this year MPs rejected reforms<\/a> to disability benefits, which some analysts say discourage people from work.<\/p>\n

Data for the second quarter of 2025 showed that 21% of Britons aged 16-64 are neither in work nor actively seeking a job, down from a peak of 22.2% last year but above a low of 20.3% before the pandemic.<\/p>\n

Reduced labour force participation is one reason why some Bank of England policymakers fear that Britain\u2019s inflation rate \u2013 the highest in the G7 at 3.8% in July<\/a> \u2013 may be slow to return to its 2% target.<\/p>\n

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The latest official data showed the UK economy grew at a faster rate than expected in the second quarter, despite a slowdown from a strong start to the year amid pressure from tax increases and Donald Trump\u2019s global trade war.<\/p>\n

The Office for National Statistics <\/a>figures showed that growth in gross domestic product slowed to 0.3%<\/a> in the three months to the end of June, down from a rate of 0.7% in the first quarter.<\/p>\n

Although it beat forecasts by City economists for a slowdown to 0.1%, the weak reading underscores the challenge for the chancellor, Rachel Reeves<\/a>, as she considers options for boosting the economy and raising revenues at her autumn budget.<\/p>\n","protected":false},"excerpt":{"rendered":"Britain faces an \u201cacute challenge\u201d from its weak underlying economic growth and a drop in the number of…\n","protected":false},"author":3,"featured_media":173055,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[64,79,67,132,68],"class_list":{"0":"post-173054","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economy","10":"tag-united-states","11":"tag-unitedstates","12":"tag-us"},"share_on_mastodon":{"url":"","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/173054","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=173054"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/173054\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/173055"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=173054"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=173054"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=173054"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}