Debt Settlement Solution:Worst of the UK recession is over
Monday, 20. July 2009
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While talk of a recovery may be premature, the British Chambers of Commerce business group has said the worst of the recession in the UK has passed.
In a survey of 5,600 companies, the BCC found that confidence levels had grown between April and June this year.
Despite the BCC’s own prediction that unemployment will reach 3.2 million before the end of the year and official government data showing a drop in manufacturing output of 0.5 per cent (despite analysts forecasting a rise of 0.2 per cent), there is still an optimistic outlook for the economy.
The monthly fall was caused by a two per cent decline in the publishing industry (including the paper and printing industries) according to the Office for National Statistics (ONS).
A broader measure of the state of the economy is industrial production, including energy supply, oil and gas and mining, as well as manufacturing. This sector fell by 0.6 per cent against a predicted rise of 0.2 per cent.
Industrial decline has contributed heavily to the rate of unemployment increasing at a high rate, which has further lead to record numbers of insolvencies.
According to official figures there were 29,774 cases of personal bankruptcy in the first quarter of 2009, 19 per cent higher than 2008.
Shrinking economy
The National Institute of Economic and Social Research (NIESR) has estimated that, in the three months up to June, the UK economy shrank by 0.4 per cent.
Previous estimations from the group suggested that, after a drop of 1.9 per cent in the first three months of 2009, the UK economy had resumed growth again in April and May.
The NIESR has now said it believes that the UK economy is “stagnating rather than continuing to contract at a sharp pace”.
Despite early predictions of a return to growth proving unrealistic, more conservative estimates suggest that economic growth will come soon.
The government forecast says the economy will grow by 1.25 per cent in 2010 and the CBI’s predictions are that the economy will grow by 0.7 per cent next year.