Shrinking UK economy in
“dire straits” as jobs and living standards are hit - TUC
Responding to today’s (Thursday) GDP figures, showing GDP fell by
0.3% in the fourth quarter of 2023, TUC General Secretary
Paul Nowak said:
“The UK economy is in dire straits. After years of Tory
stagnation, we are now in technical recession.
“The Conservatives’ economic failures are hitting jobs and living
standards. With household budgets at breaking point, spending is
down and the economy is shrinking. At the same time our crumbling
public services are starved of much-needed funding.
“After being in power for 14 years, the Tories have driven our
economy into a ditch and have no idea how to get out.
"It’s time for a government with a serious long-term plan and
strategy for renewal, to revive our economy and sustain growth
into future.”
JRF: Technical
recession is concerning but millions already in
hardship
Responding to the latest growth figures (GDP) that show the UK
economy shrank by 0.3%, JRF Chief Economist said:
"Today's news that the economy entered a technical recession is
concerning, but it will not be front of mind for the millions
already in unjustifiable hardship. Fridges are either off or
empty as already eye-watering food prices continue to rise. Loan
and mortgage repayments are being missed as elevated interest
rates crush family finances. And jobs are increasingly at risk as
the labour market continues to deteriorate.
“Just weeks before the Budget, addressing this crisis of economic
security, from individual families to the nation as a whole, must
be the first priority for policymakers. This starts with
reforming Universal Credit to reflect the actual cost of
essentials, and a revitalisation of key services across care,
housing, and job support.
“There is no quick fix. Business investment may be the lifeblood
of a growing economy, but social security and public services
provide the heartbeat."
UK falls into
recession, and a far deeper living standards downturn -
Resolution Foundation
The UK economy fell into recession in the second half of 2023,
but families have experienced a far deeper living standards
downturn, with GDP per capita now 4.2 per cent off its pre-cost
of living crisis path – equivalent to a loss of nearly £1,500 per
household – the Resolution Foundation said today.
Weaker than expected growth meant that the economy contracted by
0.5 per cent in the second half of 2023, while the economy grew
by 0.1 per cent over the whole of 2023.
While this is likely to be a be a relatively shallow recession,
the data is flattered by a growing population, says the
Foundation.
Looking instead at GDP per capita – which is what matters most
for household incomes – the Foundation notes that it has fallen
by 0.7 per cent across 2023, and hasn’t grown since Q1 2022, the
longest runs of falls or stagnation since 1955.
GDP per capita was 4.2 per cent off its pre-cost-of-living-crisis
path by the end of 2023, a loss equivalent to nearly £1,500 per
person in annual GDP terms.
The Foundation adds that the bigger picture is that Britain
remains a stagnation nation, with GDP per capita over the past 15
years (1.2 per cent), more than halving compared to the previous
15 years (2.8 per cent).
James Smith, Research Director at the Resolution
Foundation, said:
“Britain has fallen into recession, and a far deeper living
standards downturn. Even this weak data is flattered by a rising
population. After accounting for population growth, the UK
economy hasn’t grown since early 2022, and fallen far behind its
pre-cost of living crisis path, with an equivalent loss of around
£1,500 per person.
“The big picture is that Britain remains a stagnation nation, and
that there are precious few signs of a recovery that will get the
economy out of it.”
