The economy: Why the recession is worse than you think

after months of Gloom the statistical verdict on Britain's economy has arrived weak activity particularly in the retail sector meant national income the overall measure of our earnings shrank for two quarters in a row it means this country has officially entered a recession the chancellor suggests it's mainly down to forces Beyond his control we've also had a pandemic we've had a Ukraine war that has meant that inflation Rose to more than 11% so the primary challenge since I became Chancellor the most important thing that I can do to relieve pressure on families is to bring down that inflation rate look on the High Street and the signs have been there for quite some time this was uh what I call one of my rescues here in the outskirts of Southampton lavish purchases have been overtaken by repairs and Thrift the past couple of years it's really really slowed down in terms of more playful sales um the Exotic things the more desirable than necessary it's much the same story of tightening purse strings across the retail sector they will go for a cheaper option rather than a good quality one so I can see people are struggling there's no weekly customers as much anymore we used to have a lot of weekly blow dries but they seem to drift off now now in some respects nothing has really changed here the definition of a recession anyway is pretty arbitrary too successive CES of contraction and who knows the numbers could get revised further down the line but in another sense it is deeply politically awkward the Prime Minister promised us economic growth and we've ended up formerly in recession but unfortunately the real story is even worse than those official GDP numbers suggest as you can see here they show a small fall in the last two quarters those red bars but this would be the shallowest recession in more than half a century but now divide up our economic output by the population important given how fast it's growing and it's a very different story GDP per head a much better measure of living standards has been falling every quarter since early 2022 an almost unprecedented slump partly that's down to higher energy costs a problem for all households and businesses including this micro Brewery but pubs and venues here in Southampton have been closing for years there's an increasing amount of um businesses local businesses closing uh which is obviously quite um quite worrying for for communities and for business owners um all we can really do is stay positive and the economy is expected to improve this year and next and with it the fortunes of many businesses even so it's hard not to escape the fact that from brexit to co to the cost of living crisis the economy has been pummeled with one blow after another now that pain has resulted in the most dreaded of all economic terms a recession at comway Sky News

Channel: Sky News

Views: 314,300

Keywords: Sky News, Sky, Chancellor, Jeremy Hunt MP, Growth, Recession, Conservative, Government, Bank of England, breaking, live, economy, ed conway

Id: lYFvwdmGMRU

Length: 3min 2sec (182 seconds)

Published: Thu Feb 15 2024